InnovAge (INNV) Q2 2026 earnings summary

Executive summary

• Fiscal Q2 2026 delivered strong results with $239.7M in revenue, $22.2M adjusted EBITDA, and $11.8M net income, reflecting disciplined execution and operational improvements.

• Served approximately 8,010 PACE participants across 20 centers in six states as of December 31, 2025, maintaining status as the largest PACE provider in the U.S.

• Achieved significant year-over-year growth in revenue and profitability, driven by increased capitation rates, member months, 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 $239.7M, driven by higher member months and capitation rates.

• Net income of $11.8M, reversing a net loss of $13.5M in Q2 2025; EPS was $0.08 on 136.4M shares.

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

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

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