10-Q · May 5, 2026
Alight, Inc. reported Q1 2026 results with revenues of $534 million, a 2.6% decline from $548 million in Q1 2025. The adjusted diluted EPS was positive at $0.06, exceeding the expected EPS of $0.04. Management projected…
Earnings analysis · 10-Q
ALIT earnings analysis
Filed August 4, 2026 · Our reading of the company's report
The latest report
Alight's Q2 revenue fell 3.2% year over year to $511 million as recurring revenue declined 4.3% amid weaker Net Commercial Activity, although higher project revenue provided a partial offset. Profitability weakened…
Read full summary
Alight's Q2 revenue fell 3.2% year over year to $511 million as recurring revenue declined 4.3% amid weaker Net Commercial Activity, although higher project revenue provided a partial offset. Profitability weakened materially on an underlying basis: gross margin fell to 27.8%, adjusted EBITDA declined to $92 million, and adjusted EBITDA margin contracted to 18.0%. Six-month free cash flow remained stable at $101 million, but a $1.976 billion 2028 term-loan maturity, declining cash, and potential additional TRA payments remain notable liquidity considerations.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $-0.38
- Segment
- Employer Solutions revenue: $511 million in Q2 2026, down $17 million (3.2%) from $528 million in Q2 2025; recurring revenue was $471 million, down $21 million (4.3%), while project revenue was $40 million, up $4 million (11.1%).
What stood out
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Revenue declined 3.2% year over year
Q2 revenue was $511 million, down $17 million (3.2%) year over year from $528 million and down $23 million (4.3%) sequentially from $534 million in Q1 2026. The decline was driven by lower Net Commercial Activity, partly offset by higher project revenue.
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Gross margin compressed to 27.8%
Gross profit fell $34 million to $142 million, and gross margin contracted 550 basis points to 27.8% from 33.3% a year ago; it also declined from 29.2% in Q1 2026. Higher compensation expense raised cost of services by $12 million.
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Sequential operating loss widened
The operating loss was $40 million, equal to a 7.8% operating margin, versus a $22 million loss and a 4.1% loss margin in Q1 2026. Against Q2 2025's $1.01 billion operating loss, the comparison benefits from the absence of a $983 million goodwill impairment.
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GAAP EPS improved, adjusted profit fell
GAAP diluted EPS was a loss of $0.38, improving from a $0.80 loss in Q1 2026 and a $40.57 loss in Q2 2025. Adjusted diluted EPS was $0.91, down from $2.09 a year ago, while adjusted EBITDA declined to $92 million from $127 million and margin fell to 18.0% from 24.1%.
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Free cash flow held near $101 million
Six-month operating cash flow was $152 million, down $7 million from $159 million, but free cash flow was broadly stable at $101 million versus $102 million. Capital expenditures declined to $51 million from $57 million, representing 4.9% of six-month revenue.
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Liquidity includes undrawn $330 million revolver
Cash and cash equivalents were $215 million at June 30, down $58 million from December 31, 2025. The company had no revolver borrowings against its $330 million facility and retained $216 million of share-repurchase authorization.
What to watch
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Client losses and lower bookings persist
Recurring revenue decreased $21 million (4.3%) to $471 million in Q2, as management cited lower Net Commercial Activity. Management expects prior-year client losses and lower bookings to continue affecting revenue growth through the remainder of fiscal 2026.
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Large 2028 debt maturity and interest burden
Long-term term-loan principal totaled $1.976 billion as of June 30, 2026 and matures in 2028, while quarterly interest expense increased to $24 million from $22 million. Cash was $215 million, down $58 million since December 31, 2025.
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TRA dispute may require up to $40 million more
Alight paid $136 million under its Tax Receivable Agreement in the first half of 2026. It estimates that resolution of the current dispute could raise 2026 Tax Benefit Payments by up to an additional $40 million, plus interest.
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Margins weakened despite no risk-factor update
No material changes were reported to the risk factors disclosed in the February 24, 2026 Form 10-K. However, adjusted EBITDA fell $35 million to $92 million and adjusted EBITDA margin declined 610 basis points to 18.0% in Q2.
Management's outlook
The 10-Q does not provide quantitative revenue, EBITDA, or EPS guidance. Management said prior-year client losses and lower bookings are expected to continue affecting revenue growth during the remainder of fiscal 2026.
Earlier filings 4
10-K · February 24, 2026
Alight positions itself as a single-segment, technology-enabled employee experience partner centered on its Alight Worklife platform and long-term (3–5 year) per-participant contracts. The company completed a material…
10-Q · August 5, 2025
Alight reported Q2 2025 revenue of $528.0M with a GAAP operating loss driven by a $983.0M goodwill impairment. Gross profit was $176.0M (≈33.3% margin) and GAAP diluted continuing operations EPS was $(2.03). Operating…
10-Q · May 8, 2025
Alight, Inc. reported revenues of $548 million for Q1 2025, a slight decrease from $559 million in Q1 2024, reflecting ongoing challenges in operating margins which now stand at -1.5%. Despite these challenges, the…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.