Why Did Oscar Health’s Stock Dip Over 3% After-Hours?

Oscar Health shares dropped 3.7% in after-hours trading on Monday after the company said it would raise $350 million by selling convertible notes due 2030 in a private offering.

Oscar said proceeds from the deal would be used for general corporate purposes, including expansion initiatives fueled by artificial intelligence and efforts to improve member healthcare experiences. The company also flagged potential use of funds to support the extension of enhanced premium tax credits.

The notes will be unsecured and subordinated to Oscar’s senior debt, with interest payable semi-annually and a maturity date of Sept. 1, 2030, unless repurchased, redeemed, or converted earlier. 

The company said it expects to grant initial purchasers an option to buy up to an additional $52.5 million in notes.

Oscar intends to use part of the proceeds to enter into capped call transactions to offset potential share dilution from conversions, with a cap set at a 100% premium to the stock price at the time of pricing. The company said the structure offers an attractive cost of capital relative to other financing options.

The offering follows an amendment to Oscar’s investment agreement with Dragoneer Investment Group and other purchasers to permit the transaction. The company also plans to terminate its revolving credit facility with Wells Fargo once the deal closes, citing the expected boost to liquidity from the new notes.

On Stocktwits, retail sentiment for OSCR stock was ‘bearish’ amid ‘normal’ message volume late Monday.

One user expects Oscar Health’s shares to fall back to $13, arguing the company was raising funds “to be broke again.”

Another user reported exiting at $19 a couple of weeks ago after entering below $12, noting that they had profited from both shares and options before selling and were now watching for a chance to reenter.

Oscar Health’s stock has declined 39.4% so far in 2025.

For updates and corrections, email newsroom[at]stocktwits[dot]com.