InnovAge (INNV) Q2 2026 earnings summary

Executive summary

• Achieved total revenues of $239.7 million, adjusted EBITDA of $22.2 million, net income of $11.8 million, and center-level contribution margin of $52.8 million for Q2 2026, reflecting disciplined execution and operational improvements.

• Adjusted EBITDA margin reached 9.2%, meeting the intermediate-term target ahead of schedule.

• Growth driven by improved Medicaid eligibility processes, strong medical cost management, and operational efficiencies.

• Governance changes include Tom Scully returning as Chairman and new board appointments to support the next phase of execution.

• Continued to face labor market pressures, regulatory changes, and macroeconomic uncertainties, but implemented initiatives to offset cost increases and support growth.

Financial highlights

• Revenue rose 14.7% year-over-year to $239.7 million, driven by higher member months and capitation rates.

• Net income was $11.8 million, reversing a net loss of $13.5 million in the prior year quarter; EPS was $0.08 on 136.4 million shares.

• Adjusted EBITDA increased to $22.2 million from $5.9 million year-over-year; margin improved to 9.2% from 2.8%.

• Center-level contribution margin rose to $52.8 million (22% of revenue), up from $37.1 million (17.7%).

• Cash and equivalents at $83.2 million, with $42.8 million in short-term investments and $69.9 million in total debt.

Outlook and guidance

• Full-year 2026 guidance raised: member months 92,900–95,700, revenue $925M–$950M, adjusted EBITDA $70M–$75M.

• Ending census expected between 7,900 and 8,100 participants; de novo losses projected at $11.5M–$13.5M.

• Guidance reflects operational improvements, higher Medicaid rates, and successful Medicaid reinstatements.

• Q3 expected to be seasonally softer due to slower enrollment and higher flu incidence, with Q4 returning to normalized growth.

• Guidance subject to risks and factors outside management's control, including macroeconomic and regulatory conditions.