InnovAge Q2 Revenues Jump 14.7% to $239.7M, Net Income $11.8M and Raises FY26 Outlook
InnovAge reported Q2 fiscal 2026 revenues of $239.7 million, up 14.7% year-over-year, and net income of $11.8 million, reversing a prior-year loss of $13.5 million. The company raised full-year fiscal 2026 revenue guidance to $925–950 million and adjusted EBITDA forecast to $70–75 million.
1. Earnings Beat and Profitability Turnaround
InnovAge reported adjusted earnings per share of $0.08 for the fiscal second quarter ended December 31, 2025, surpassing the consensus estimate of $0.04 and reversing a year-ago loss of $0.10 per share. Net income attributable to InnovAge Holding Corp. reached $10.6 million, compared with a net loss of $13.2 million in Q2 fiscal 2025, driving a net income margin of 4.9% versus a 6.5% loss margin last year. This marks the company’s first quarterly profit since transitioning to the public markets in mid-2021 and underscores disciplined cost management and operational leverage in its PACE model.
2. Revenue Growth and Segment Contribution
Total revenues climbed 14.7% year-over-year to $239.7 million, up from $209.0 million in the prior-year quarter. The center-level contribution margin widened to $52.8 million, representing 22.0% of revenue and up 4.3 percentage points from 17.7% in Q2 fiscal 2025. Adjusted EBITDA more than tripled to $22.2 million, yielding a 9.2% margin, compared with 2.8% in the year-ago period. Management attributed this improvement to higher reimbursement rates in key markets and efficiency gains in home-based care delivery across its 20 centers in six states.
3. Participant Census and Operational Scale
The company ended the quarter serving approximately 8,010 participants, up from 7,480 participants a year earlier, delivering total member months between 23,800 and 24,100. This enrollment growth reflects successful expansion into two new service areas in Colorado and Texas and steady retention within existing sites. InnovAge maintained care quality metrics above industry benchmarks, achieving a 92% satisfaction rating among dual-eligible seniors and reducing hospital readmission rates by 12% compared to the prior year.
4. Raised Guidance and Balance Sheet Strength
InnovAge raised full-year fiscal 2026 revenue guidance to a range of $925 million to $950 million and adjusted EBITDA to $70 million–$75 million, while maintaining an ending census target of 7,900–8,100 participants. As of quarter end, the company held $83.2 million in cash and equivalents and $42.8 million in short-term investments against $69.9 million of total debt. The debt profile consists primarily of a secured term loan and revolving credit facility with manageable maturities through 2028, supporting continued investment in de novo center openings and technology enhancements.