$HNGE earnings report

Hinge Health reported Q3 2026 revenue of $235.0 million, up 52% year-over-year from $154.2 million. LTM calculated billings increased 54% to $960.3 million and clients increased 28% to 3,270, providing the reported demand indicators behind the revenue result. Management also described a record sales season, with MSK Care Program clients up almost 30% YoY, GI Care Program clients roughly 40% higher since the Cylinder Health acquisition announcement, and Migraine Care Program clients nearly doubled since last quarter.

Profitability improved substantially. GAAP gross margin was 87%, compared with 82% in Q3 2025, while non-GAAP gross margin was 88%, compared with 83%. GAAP income from operations was $50.3 million, compared with a GAAP loss from operations of $6.1 million, and non-GAAP income from operations increased 154% to $77.2 million. GAAP operating margin was 21% versus (4)%, while non-GAAP operating margin was 33% versus 20%.

The company generated $114.6 million of operating cash flow and $112.7 million of free cash flow in Q3. Free cash flow margin was 48%, below the 53% reported in Q3 2025. Cash, cash equivalents, marketable securities and restricted cash were $358.5 million as of September 30, 2026. During the quarter, cash flow reflected $(97,353) for the acquisition of a business, net of cash acquired, $(25,893) for repurchase and retirement of common stock, and $(96,565) of tax withholdings on settlement of restricted stock units and performance-based restricted stock units.

The company raised full-year 2026 guidance to revenue of between $879 million and $881 million, reflecting 50% growth at the midpoint, and non-GAAP income from operations of between $266 million and $268 million, reflecting 123% growth and a 30% non-GAAP operating margin at the midpoint. Q4 guidance calls for revenue of between $249 million and $251 million and non-GAAP income from operations of between $81 million and $83 million, with a 33% non-GAAP operating margin at the midpoint. The guide frames sustained growth and margin expansion, while the company notes that GAAP operating guidance cannot be reconciled without unreasonable efforts due to uncertain stock-based compensation, payroll-tax, amortization and acquisition-related items.

Investors should focus on Q4 execution against the raised full-year outlook, client and billings growth, cash conversion, and the integration of Cylinder Health. The period also includes a leadership transition: Jim Pursley will step down as President effective January 1, 2027, join the Board effective January 4, 2027, and Aaryn Pure will lead the commercial organization as Chief Commercial Officer.

Hinge Health reported a strong second quarter, with revenue increasing 53% year-over-year to $212.8 million and LTM calculated billings increasing 52% year-over-year to $861.8 million. The client base reached 2,929 clients, up 24% year-over-year. Management attributed the quarterly outperformance to continued high member conversion and pointed to its ability to improve member outcomes and lower client costs.

Profitability improved substantially. GAAP gross margin was 86%, compared to 70% in Q2 2025, while non-GAAP gross margin was 87%, compared to 83%. GAAP income from operations was $40.4 million, compared with a GAAP loss from operations of $580.7 million in Q2 2025, when stock-based compensation expense was $591.0 million. Non-GAAP income from operations increased 136% to $61.5 million, and non-GAAP operating margin expanded to 29% from 19%.

Cash generation was also a central feature of the period. Net cash provided by operating activities was $101.4 million compared to $20.2 million in Q2 2025, and free cash flow was $99.6 million compared to $32.6 million. Cash, cash equivalents, marketable securities and restricted cash were $475.6 million as of June 30, 2026. The board increased the repurchase program, leaving $300.0 million available for future repurchase as of July 29, 2026.

The company is expanding beyond its core musculoskeletal care programs through a definitive agreement to acquire Cylinder Health for $105 million in cash consideration. The transaction is expected to close in the third quarter of 2026, subject to customary closing conditions, and the integrated Gastrointestinal Care Program is expected to launch in 2027. Management also cited rapid adoption of the Migraine Care Program.

Outlook was raised for full-year 2026. Hinge Health now expects full-year revenue between $856 million and $860 million and non-GAAP income from operations between $236 million and $244 million, with non-GAAP operating margin of 28% at the midpoint. For Q3 2026, it expects revenue between $223 million and $225 million and non-GAAP income from operations between $61 million and $63 million, with non-GAAP operating margin of 28% at the midpoint. The filing does not provide the prior outlook figures needed to assess the magnitude of the guidance increase versus previous guidance.