OSCR // Q2 2026 EARNINGS
THEVALUETRADER RESEARCH
EARNINGS DASHBOARD: AUG 6, 2026
REF: OSCR-Q2-2026-EARNINGS
Oscar Health: Q2 2026 Earnings
A GAAP swing to profit, record first half results, and a raised outlook sent shares double digits higher
Headline
Revenue of $4.88B beat estimates as EPS swung to $1.10 from a loss of $0.89 a year ago, and adjusted EBITDA of $415.3M crushed consensus, sending shares up roughly 12 to 15 percent.
REVENUE$4.88B: +70.4% YoY, beat ~$4.73B to $4.74B est.
GAAP EPS$1.10: vs loss of $0.89 a year ago
ADJUSTED EBITDA$415.3M: vs $170.9M est., 8.5% margin
OPERATING MARGIN8%: up from -8% a year ago
FY2026 OPERATING EARNINGS GUIDANCERaised to $500M to $700M
STOCK REACTION+~12% to +15%
Cleared the Bar
Beats
- Revenue $4.88B vs $4.73B to $4.74B consensus, up 70.4% YoY from $2.86B a year earlier
- GAAP EPS $1.10 vs a loss of $0.89 a year ago, and vastly above the roughly $0.37 to $0.41 analyst consensus range across data providers
- Adjusted EBITDA $415.3M vs $170.9M expected, a more than doubling of consensus at an 8.5% margin
- Operating margin swung to positive 8% from negative 8% a year earlier, a full 16 percentage point improvement
- Free cash flow margin expanded to 42.6% from 17.5% a year ago
- Net income reached $362M for the quarter, with six month revenue for H1 2026 totaling $9.53B, described by the company as record first half profitability
Watch Items
Softer Spots
- Revenue growth was partially offset by an increase in the net risk adjustment transfer accrual, a normal but real cost item for ACA marketplace insurers
- Full year revenue guidance was reaffirmed rather than raised, even as operating earnings guidance moved higher, a distinction worth tracking
- Wall Street's forward estimate for full year EPS growth over the next 12 months sits at a modest 5.3%, from $1.38 to $1.46, suggesting analysts see this quarter's magnitude of improvement as difficult to repeat at the same pace
φ 02Income Statement Snapshot
REVENUE (Q2 2026 vs Q2 2025)$4.88B vs $2.86B, +70.4%
GAAP EPS (Q2 2026 vs Q2 2025)$1.10 vs -$0.89
NET INCOME$362M
ADJUSTED EBITDA$415.3M, 8.5% margin
OPERATING MARGIN8% vs -8% a year ago
FREE CASH FLOW MARGIN42.6% vs 17.5% a year ago
MEDICAL LOSS RATIO (MLR)75.0%
H1 2026 TOTAL REVENUE$9.53B
EFFECTUATED MEMBERSHIP2.96 million
For reference: Oscar's Q2 2025 loss of $0.89 per share and operating margin of negative 8% set an unusually low bar, itself reflecting a difficult prior year period. The magnitude of this quarter's swing, from a meaningful loss to $1.10 in positive EPS, is as much a story of last year's weak comparison as it is of this year's execution, though the sequential H1 2026 trend of record profitability confirms the improvement has continued to build across two consecutive quarters.
Growth Drivers
- Revenue growth was driven primarily by higher membership and rate increases across Oscar's individual ACA marketplace plans
- Effectuated membership reached 2.96 million, underpinning the topline growth alongside pricing actions taken into the 2026 plan year
- Growth was partially offset by an increase in the net risk adjustment transfer accrual, a standard ACA marketplace mechanism that redistributes funds among insurers based on relative member risk
Strategic Positioning
- Oscar operates a full stack technology platform serving individuals, families, and employees through ACA marketplace plans, alongside its +Oscar health technology business that licenses its platform to other healthcare organizations
- The company wholly owns Lucie, a technology enrollment platform, Trove Group, an insurance agency selling individual medical and supplemental products, and HealthInsurance.org, a lead generation and education platform for consumers navigating ACA and Medicare marketplaces
- Management explicitly linked its growth thesis to structural labor market shifts, citing increased movement between full and part time jobs, gig work, and retirement as durable tailwinds for the individual insurance market that AI driven workforce change is expected to accelerate
Mark Bertolini, CEO
"Oscar delivered record profitability in the first half of the year and we are raising our full-year 2026 guidance. Our superior operating performance and execution against the fundamentals of our strategy are accelerating the individual market. More people are moving between full- and part-time jobs, gig work, and retirement, a shift AI will accelerate. A durable individual market gives them greater choice and will power the future of American healthcare. Oscar's consumer products, disciplined pricing, and scalable technology platform will capture this opportunity and position us for long-term profitable growth."
Bull Case
Positives
- A 16 percentage point swing in operating margin, from negative 8% to positive 8%, in a single year is an exceptionally large profitability inflection for a health insurer of this scale, and it arrived alongside 70%-plus revenue growth rather than at growth's expense
- Free cash flow margin expanding to 42.6% from 17.5% shows the improved profitability is translating into real cash generation, not just favorable accounting
- Raising full year operating earnings guidance to $500M to $700M, on the back of record first half results, gives management's own forward confidence real, quantified backing
- A medical loss ratio of 75.0% sits at a healthy level for an ACA marketplace insurer, suggesting pricing discipline and risk selection are working as intended alongside membership growth
- The stock's roughly 12% to 15% single day move confirms the market read this quarter as a genuine inflection point rather than a one time beat
Bear Case
Concerns
- The comparison base was unusually weak, with Q2 2025's negative 8% operating margin and $0.89 per share loss reflecting a genuinely difficult prior year period, which flatters the magnitude of this quarter's year over year improvement
- Full year revenue guidance was reaffirmed rather than raised, even as profit guidance moved higher, suggesting management sees the profitability gain as coming more from margin and mix than from accelerating top line growth
- Wall Street's own forward estimate implies full year EPS growth of just 5.3% over the next 12 months, well below the scale of improvement seen this quarter, signaling analysts do not expect this pace of margin expansion to repeat indefinitely
- As a pure play ACA marketplace insurer, Oscar remains exposed to regulatory and subsidy policy risk specific to the individual health insurance market, a factor outside the company's direct control that can meaningfully affect membership and pricing dynamics
- The increase in net risk adjustment transfer accrual is a reminder that ACA marketplace economics involve inter insurer redistribution mechanics that can shift unpredictably from period to period
φ 06Full Year 2026 Guidance
FY2026 OPERATING EARNINGS (NEW)$500M to $700M
FY2026 REVENUE GUIDANCEReaffirmed
EFFECTUATED MEMBERSHIP2.96M
MEDICAL LOSS RATIO (H1 2026)75.0%
WALL STREET FY EPS GROWTH ESTIMATE (NEXT 12 MOS.)+5.3%, from $1.38 to $1.46
- Shares jumped between roughly 12% and 15% depending on the data source and timing snapshot, one of the largest single day earnings reactions among health insurers this season
- Oscar's EPS has swung sharply from quarter to quarter over the past two years, moving from meaningful losses to significant profits, reflecting both seasonal ACA marketplace dynamics and the company's improving underlying execution
- Analyst sentiment heading into recent quarters had been mixed to cautious, with the stock previously carrying a Reduce-equivalent average rating earlier in 2026 before this quarter's results
- Next scheduled report: Q3 2026, expected early November 2026
φ 08TVT Verdict: Quick Reference
Oscar Health's Q2 2026 is a genuinely large profitability inflection, an operating margin swing of 16 percentage points, a free cash flow margin nearly tripling, and adjusted EBITDA more than doubling consensus, delivered alongside 70%-plus revenue growth rather than a growth slowdown. The double digit stock reaction reflects a market that had grown skeptical of Oscar's path to sustained profitability finally seeing hard evidence that the individual ACA marketplace business can scale profitably at this size. The important nuance is that revenue guidance for the full year was reaffirmed, not raised, while only operating earnings guidance moved higher, telling investors this improvement is currently more about margin execution, pricing discipline, and cost control than about faster underlying growth. The unusually weak year ago comparison also means some of this quarter's percentage improvements will be harder to replicate as easier comparisons roll off. Still, two consecutive quarters of record first half profitability, a healthy 75.0% medical loss ratio, and management's explicit framing around structural labor market tailwinds for individual insurance give this quarter's beat real substance beyond a single period surprise. The next test is whether Oscar can sustain double digit operating margins as comparisons normalize through the back half of 2026. Next earnings expected early November 2026.
GAAP EPS
$1.10 (swing to profit)
Adj. EBITDA
$415.3M (beat)
Operating Margin
8% (from -8%)
FY Op. Earnings Guide
$500M to $700M
Stock Reaction
+12% to +15%
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