Omada Health Q3 Revenue Rises 34% as Profitability Improves

Omada Health reported stronger third-quarter profitability as revenue and membership grew, while lower care-delivery costs helped lift gross margins. Revenue for the quarter ended September 30, 2026, rose 34% year over year to $91.3 million from $68.0 million, and the digital-care provider posted GAAP net income of $6.6 million, compared with a $3.2 million loss a year earlier.

Adjusted EBITDA increased to $12.4 million from $2.4 million, with the adjusted EBITDA margin expanding to 13.6% from 3.5%. GAAP gross margin reached 75.9%, up from 66.3%, while non-GAAP gross margin rose to 77.7% from 68.2%.

Membership growth and lower service costs

Omada ended the quarter with 1.13 million members who had been billed at least once during the preceding 12 months, an increase of 36% from 831,000 a year earlier. The company said growth was broad-based across its cardiometabolic programs.

Trailing-12-month revenue per ending member increased 5% to $294. Average member tenure reached a record two years and four months, up 10% year over year, supported by a larger mix of diabetes and hypertension members.

Longer participation and lower delivery costs contributed to improved unit economics. Non-GAAP cost to serve declined to an all-time low of $81 per member on a trailing-12-month basis, from $94 a year earlier. Services costs fell to $43 per member from $53, while hardware costs decreased to $38 from $41.

Trailing-12-month non-GAAP gross profit per member increased to $213 from $186 in the prior-year period. Omada said members have historically generated contribution profit within one quarter of enrollment and generally become more profitable the longer they remain in a program.

Broader product mix supports expansion

Prevention and Weight Health remained Omada’s largest business, accounting for 73% of revenue in the first nine months of 2026. That share has declined as newer offerings—including diabetes, hypertension and musculoskeletal care—have contributed more revenue.

As of September 2026, 33% of existing contracts covered multiple products. The company sees further opportunities to add cholesterol care, prescribing services and GLP-1 support to existing customer relationships.

Omada markets its programs through employers, health plans and pharmacy benefit managers. The company had more than 25 million covered lives as of the end of 2025 and calculated an enrollment rate of about 4.5% as of September 30, 2026. It also reported more than 2,000 customers, with a three-year average customer retention rate above 90% as of December 2025.

GLP-1 services are a particular expansion area. Omada offers a care track with prescribing for employers that cover the drugs and a prescribing-plus-cash-pay option where coverage is unavailable. The company presented GLP-1 care as an entry point into its broader cardiometabolic programs, although the clinical and savings figures cited were based on company cohort studies and modeling, and some estimates excluded Omada’s fees and medication costs.

PBM channels, engagement and AI investment

Management expects newer, multi-product PBM channels to compound faster than the legacy business. Omada said one new PBM channel offers multiple products with moderate competition, while another includes both multiple programs and prescribing with minimal competition. The presentation characterized that expectation as directional and did not provide specific financial projections.

The company is also investing in artificial intelligence and automation to improve enrollment conversion, member engagement and operating efficiency. Planned product work over the next 18 to 24 months includes predictive support, escalation triage, visit summaries, nutrition tools, guided movement and additional connected-device capabilities. Omada cautioned that the timing and sequence are illustrative and that roadmap items may be delayed or may not be delivered.

Its operating model combines technology with human care teams. Management said AI is intended to summarize information, handle factual questions and support workflows, while clinicians and coaches remain responsible for interactions where relationships and behavior change are central.

Concentration and execution risks

Omada’s payer channels remain concentrated even though the underlying end-customer base is more diversified. Its two largest contracted payer or partner relationships represented 33% and 28% of year-to-date billings through September, respectively. At the end-customer level, the two largest customers accounted for 14% and 10% of billings.

The company identified other risks including its limited operating history, history of net losses, customer and partner retention, member engagement, competition, dependence on third-party suppliers, cybersecurity threats and healthcare regulation. Future growth also depends on converting covered lives into enrolled members, expanding multi-program adoption and maintaining engagement after enrollment.