Alignment Healthcare reported fourth‑quarter and full‑year 2025 financial results that exceeded analyst expectations. Total revenue reached $1.01 billion, up 44% year‑over‑year from $701.24 million in Q4 2024, while membership grew 25% year‑over‑year to 1.3 million plans. The company posted an earnings‑per‑share loss of $0.05, a $0.10 improvement over the consensus estimate of a $0.15 loss, and generated a positive adjusted EBITDA of $110 million for the full year, a turnaround from the near‑breakeven $1 million in 2024.
The revenue growth was driven by a 44% increase in Medicare Advantage premiums and a 25% rise in member enrollment, reflecting strong demand for the company’s high‑star plans. The Medical Benefits Ratio (MBR) improved to 87.5%, the lowest MBR quarter of the year, indicating tighter cost control and higher reimbursement rates. Adjusted EBITDA margin expanded to 2.8% from 1.5% in 2024, driven by scale and improved mix of high‑margin plans.
The earnings beat was largely attributable to disciplined cost management and a favorable mix shift toward higher‑margin Medicare Advantage contracts. The company’s embedded gross profit within its existing membership base was approximately $600 million, underscoring the profitability of its current member cohort. The $0.05 EPS loss represents a 67% positive surprise relative to the $0.15 consensus estimate.
For 2026, Alignment Healthcare guided revenue of $5.14 billion to $5.19 billion and adjusted EBITDA of $133 million to $163 million. The guidance is conservative relative to analyst expectations, implying a deceleration from the 46% year‑over‑year revenue growth seen in 2025. Investors focused on this forward‑looking outlook, which tempered enthusiasm despite the strong quarterly performance.
Management highlighted the company’s strategic positioning, noting that approximately 98% of its members are enrolled in plans that will receive 4‑star or higher ratings in 2026, providing a tailwind for future reimbursement rates. CEO John Kao emphasized that the Q4 results “underscore our commitment to delivering strong financial performance and expanding our market presence,” and that the company is “particularly pleased with our revenue growth and cash flow generation.”
Investors reacted cautiously, focusing on the 2026 guidance, which was viewed as conservative and implied a deceleration in growth compared to the robust 2025 performance.
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