10-Q · May 7, 2026
InnovAge Holding Corp. reported strong revenue growth in Q3 FY2026, with total revenues reaching $251.943 million, a 15.5% increase from the prior year. However, the company experienced a net loss of $29.9 million,…
Earnings analysis · 10-K
INNV earnings analysis
Filed September 8, 2026 · Our reading of the company's report
The latest report
InnovAge delivered a significant fiscal 2026 recovery, with revenue up 15.9%, operating income turning positive at $2.618 million, and Adjusted EBITDA margin expanding to 9.6%. The PACE platform continues to scale,…
Read full summary
InnovAge delivered a significant fiscal 2026 recovery, with revenue up 15.9%, operating income turning positive at $2.618 million, and Adjusted EBITDA margin expanding to 9.6%. The PACE platform continues to scale, reaching approximately 8,230 participants across 20 centers, while operating cash flow nearly doubled to $64.714 million. However, the improvement remains exposed to $37.0 million of accrued litigation, anticipated Medicaid rate reductions that management expects to pressure fiscal 2027 margins, and California restrictions on new-center expansion.
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.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
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
- $-0.02
- Operating margin
- 0.26%
What stood out
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Double-digit capitation-led growth
Revenue increased 15.9% to $989.707 million in fiscal 2026 from $853.699 million in fiscal 2025. Capitation revenue rose 16.0% to $988.384 million, driven by a 7.8% increase in member months and a 7.6% increase in capitation rates.
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Near break-even GAAP results
Operating income improved to $2.618 million from a $29.761 million operating loss, while net loss attributable to InnovAge narrowed to $2.537 million, or $0.02 diluted loss per share, from $30.313 million, or $0.22 per share.
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Material operating leverage
Adjusted EBITDA increased 174% to $94.571 million, and Adjusted EBITDA margin expanded to 9.6% from 4.0%. Center-level Contribution Margin rose to $227.764 million, or 23.0% of revenue, from $153.639 million, or 18.0%.
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Scaled PACE platform
The company served approximately 8,230 PACE participants as of June 30, 2026, making it the largest U.S. PACE provider by participants served, and operated 20 centers across six states and 14 markets.
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Stronger cash generation
Operating cash flow increased to $64.714 million from $32.866 million. Cash and cash equivalents rose to $97.891 million from $64.129 million after $14.309 million of property and equipment purchases.
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External cost performance improved
External provider cost per participant decreased 3.2%, while external provider costs grew 4.3% to $449.843 million despite a 7.8% increase in member months, reflecting lower nursing-facility utilization and pharmacy cost savings from in-house pharmacy services.
What to watch
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Large unresolved litigation exposure
Litigation became a materially larger financial exposure: fiscal 2026 litigation expense included $56.966 million of charges, including $52.4 million accrued for potential resolutions or paid settlements. The balance-sheet litigation accrual was approximately $37.0 million at June 30, 2026, substantially related to DOJ and Colorado Medicaid False Claims Act matters.
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Medicaid rate pressure
Management expects Medicaid reimbursement pressure in fiscal 2027, including a retroactive decrease in Medicaid premium rates in Colorado, the company’s largest census cohort, and potential California rate pressure beginning January 1, 2027. The company states these pressures are expected to affect fiscal 2027 margins.
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California expansion constrained
California’s DHCS paused applications for all new PACE centers for a minimum of two years beginning November 20, 2025. DHCS also suspended attestations for planned Downey and Bakersfield centers after Sacramento and San Bernardino compliance issues; the company withdrew its Downey application in July 2026 and continues to pursue Bakersfield subject to remediation.
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Leverage and covenant constraints
The company had $48.812 million of Term Loan A debt outstanding at June 30, 2026, with a variable interest rate of 6.15% and $94.797 million of total long-term debt and lease obligations. The credit agreement also restricts dividends, equity transactions, capital expenditures and permitted investments.
Management's outlook
The 10-K does not provide quantitative fiscal 2027 revenue or EPS guidance; annual outlook was provided in the fiscal 2026 earnings release / call.
Earlier filings 4
10-Q · November 4, 2025
InnovAge reported Q1 revenue of $236.105M and GAAP diluted EPS of $0.06 for the three months ended September 30, 2025, compared with $205.142M revenue and $(0.04) EPS in the year-ago quarter. The quarter delivered…
10-K · September 9, 2025
InnovAge describes a scale-driven, vertically integrated PACE (fully capitated) care model focused on frail, dual-eligible seniors and served approximately 7,740 participants across 20 centers as of June 30, 2025. The…
10-Q · November 5, 2024
InnovAge reported revenue of $205,142,000 for the quarter ended September 30, 2024, up $22,657,000 (+12.4%) versus the prior-year quarter, with an improved operating loss of $(4,896,000) (vs. $(10,718,000) a year ago)…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.