Evolent Health (EVH) Q3 2026 earnings summary

Executive summary

• Q3 revenue was $725.4M, up ~11% QoQ and 51.3% YoY; Adjusted EBITDA was $34.3M versus $39.0M a year earlier, and GAAP net loss was $23.6M versus $26.9M.

• MER was 93% versus 95% in Q2, reflecting favorable in-year claims development; it was 85% a year earlier, or 91.9% excluding Evolent Care Partners.

• Growth reflected new Performance Suite contract go-lives and expanded oncology services; a four-year renewal was secured with the largest Surgical Management client.

Financial highlights

• Q3 operating loss was $6.2M versus operating income of $0.9M a year earlier; diluted loss per share was $0.21 versus $0.24.

• Nine-month revenue rose 33.2% to $1.87B; net loss attributable to common shareholders narrowed to $78.6M from $150.3M.

• Q3 operating cash flow was ~$26M; nine-month cash from operations was $16.1M versus cash used of $10.0M a year earlier.

• Q3 interest expense was $17.0M; nine-month interest expense was $50.7M, primarily reflecting added secured borrowings and 2031 notes.

Outlook and guidance

• FY2026 revenue guidance was reiterated at $2.6B–$2.7B; Adjusted EBITDA guidance was raised to $130M–$135M from $120M–$135M.

• FY2026 operating cash flow guidance is $10M–$20M; capital expenditure guidance is $26M–$28M.

• Q4 Adjusted EBITDA is expected to increase $11M–$16M sequentially; FY MER guidance remains ~93%, with a smaller sequential improvement expected in Q4.

• The 2027 Adjusted EBITDA guidance midpoint remains $150M or higher; detailed guidance is expected with Q4 results in February.

• 2027 drivers include contract maturation, membership growth and cost reductions; offsets include Medicaid and Administrative Services attrition, scope changes and investment costs. AI returns are expected from late 2027, with further benefits in 2028 and beyond.