InnovAge Holding 2026 Q1 Earnings Record Net Income Surges 234%

InnovAge Holding (INNV) delivered a strong earnings performance in Q1 2026, surpassing expectations with a $0.06 EPS and $7.67 million net income. The company reaffirmed its full-year guidance, signaling confidence in its strategic execution and operational improvements.

Revenue

InnovAge’s total revenue surged 15.1% year-over-year to $236.10 million in Q1 2026, driven by robust capitation revenue of $235.75 million. Other service revenue, though minimal at $354,000, complemented the core business. The performance underscores the company’s resilience in the PACE model, outpacing challenges in Medicare Advantage and Medicaid.

Earnings/Net Income

The company returned to profitability with a $0.06 EPS in Q1 2026, reversing a $0.04 loss in the prior-year period—a 250% improvement. Net income of $7.67 million marked a 234.3% increase from a $5.71 million loss in Q1 2025, setting a six-year record for Q1 net income. This turnaround highlights effective cost management and Medicaid redetermination progress.

Post-Earnings Price Action Review

Despite strong earnings, InnovAge’s stock faced significant post-reporting volatility. Shares plummeted 17.65% on the latest trading day, 17.22% for the week, and 22.52% month-to-date. The disconnect between financial results and market reaction underscores investor skepticism about the sustainability of Q1 performance amid seasonality and Medicaid redetermination timing.

CEO Commentary

CEO Patrick Blair emphasized a 15% revenue increase to $236.1 million and adjusted EBITDA doubling to $17.6 million, crediting medical cost management and Medicaid progress. He outlined strategic priorities: expanding existing centers, pursuing M&A, and upgrading systems like Epic EMR. Leadership changes, including the departure of COO Michael Scarbrough, were noted, but Blair stressed organizational maturity and cost discipline.

Guidance

InnovAge reaffirmed 2026 guidance: $900–950 million revenue, $56–65 million adjusted EBITDA, and 7,900–8,100 census. CFO Ben Adams highlighted factors like Medicaid eligibility changes and Q3 margin pressures from open enrollment. The company remains focused on disciplined execution and operational improvements.

Additional News

InnovAge announced strategic leadership changes, including the appointment of Dr. Paul Taheri as Chief Medical Officer and Meredith Delk as Chief Administrative Officer. The company also emphasized expansion through joint ventures and de novo centers. While no immediate M&A activity was disclosed, management reiterated a multi-pronged growth strategy.

The stock’s recent volatility contrasts with its year-to-date 20.6% gain, outperforming the S&P 500. Analysts remain cautious, with a “Hold” rating and a $6.00 median 12-month price target. InnovAge’s focus on operational upgrades and market differentiation positions it for long-term growth, though near-term challenges like Medicaid redetermination and competitive pressures persist.