Q1 2026 Earnings — Reported May 6, 2026 · Record Quarter
Revenue +53% YoY · EPS $2.07 vs $1.11 est. · MLR drops to 70.5%
Oscar Health delivered its highest net income in company history — $679M vs $275M a year ago. EPS beat by 86% ($2.07 vs $1.11 consensus). Revenue reached $4.6B on 55% membership growth to 3.17M members. MLR improved 490bps to 70.5% — well ahead of FY guidance. Operating margin expanded 540bps to 15.2%. Full-year 2026 guidance reaffirmed across all metrics. Stock +13% on the day.
Key Metrics — Q1 2026 Actuals
Total Revenue
$4.65B
+53% YoY
Net Income
$679M
vs $275M Q1 2025
Diluted EPS
$2.07
vs $0.92 Q1 2025
Medical Loss Ratio
70.5%
−490bps YoY
Adj. EBITDA
$727M
vs $329M Q1 2025
Membership
3.17M
vs 2.04M Q1 2025
EPS Beat
+86%
$2.07 actual vs $1.11 consensus
Operating Margin
15.2%
+540bps YoY — record
Cash & Investments
$8.1B
$1.7B capital surplus in subsidiaries
Operating Cash Flow
$2.62B
Q1 2026 — exceptionally strong
Beat / Miss Matrix
Beats
EPSEst. $1.11$2.07 (+86%)
Medical Loss RatioFY Guide 82.4–83.4%70.5% (far ahead)
Operating Income—$704M (+2.5x YoY)
Adj. EBITDA—$727M (+121% YoY)
Operating Margin~10%15.2% (+540bps)
Membership Growth~2.8M3.17M (+55% YoY)
Concerns / Misses
Revenue vs. Est.Est. $4.89B$4.65B (−5% miss)
Q1 MLR Seasonality—Favorable — will normalize
ACA Subsidy Risk—Enhanced PTCs expired; churn risk
SG&A Ratio—15.2% — slight vs 15.8% FY guide
MLR Rest of Year—Guided higher Q2–Q4
House Judiciary Subpoena—Regulatory scrutiny on premiums
P&L Summary — Q1 2026 vs Q1 2025
Select Income Statement (USD millions)
Total Revenue$4,650$3,040+53%
Medical Loss Ratio (MLR)70.5%75.4%−490bps
SG&A Expense Ratio15.2%15.8%−60bps
Operating Income (EFO)$704$297+137%
Operating Margin15.2%9.8%+540bps
Net Income (Oscar share)$679$275+147%
Diluted EPS$2.07$0.92+125%
Adj. EBITDA$727$329+121%
Operating Cash Flow$2,619—Record
Cash & Investments (end Q1)$8,100—Strong
Business Highlights & CEO Quote
Membership & Product
Total Members (end Q1)3.17M (+55% YoY)
Individual & Small Group100% of membership
Cigna+Oscar wind-downCompleted — fully independent
Lucie Health MarketplaceNew — CMS-approved platform
Oswell AI AgentOpenAI-powered health agent
HelloMeno PlanFirst ACA menopause health plan
ICHRA X PlatformEmployer health plan expansion
Balance Sheet & Capital
Cash & Investments (total)$8.1B
Cash at parent$279M
Subsidiary capital & surplus$1.7B
Excess capital$809M
Revolving credit facility$475M (exp. 2029)
Fav. prior period reserve dev.$68M in Q1 2026
"Oscar Health drove solid first-quarter performance with significant year-over-year improvements across our core metrics. We are reaffirming our guidance and remain on track to significantly expand margins and achieve meaningful profitability in 2026. Consumers expect to shop for healthcare like everyday products — on choice, price, and value. Oscar's exceptional technology, lifestyle products, and member experience deliver exactly that."
Mark Bertolini, CEO · Q1 2026 Earnings Call, May 6, 2026
FY 2026 Guidance — Reaffirmed
Full-Year 2026 Targets — All Metrics Reaffirmed Post Q1
FY 2026 Total Revenue
$18.7–19.0B
+60% YoY
FY MLR Target
82.4–83.4%
Q1 at 70.5%
SG&A Ratio Target
15.8–16.3%
Q1 at 15.2%
Earnings from Operations (EFO)
$250–450M
FY 2026
Adj. EBITDA (est.)
~$365–565M
~$115M above EFO
Q1 2026 Adj. EBITDA (achieved)
$727M ✓
Far above run rate
Long-Term Revenue Target
$21.6B
2029 proj.
Positives & Concerns
Positives
▲Q1 2026 was Oscar's thesis-confirming quarter — 70.5% MLR vs 82–83% FY guidance proves 2025's elevated costs were cyclical, not structural. The pricing discipline and AI-driven care management are delivering measurably superior underwriting economics.
▲3.17M members — 55% YoY growth — makes Oscar the largest insurer fully dedicated to the individual ACA market. Scale advantages compound: better provider contracts, richer data for AI models, and spreading SG&A over a larger premium base.
▲Lucie Health Marketplace + ICHRA X opens entirely new TAM — employer-sponsored plans and carrier-agnostic distribution. This transforms Oscar from an ACA-only insurer into a healthcare distribution platform with higher-margin revenue streams.
▲$8.1B cash + $2.6B operating cash flow in Q1 alone provides enormous strategic optionality. $809M excess capital in subsidiaries means Oscar can grow membership aggressively without capital constraints.
▲Oswell AI agent (OpenAI-powered) is building a proprietary data moat. Real-time drug pricing, bilingual voice agents, and AI-driven care navigation reduce friction and medical costs simultaneously — structural cost advantage vs legacy insurers.
Concerns
▼Q1 MLR of 70.5% is heavily influenced by seasonality — Q1 always benefits from lower utilization (deductibles reset, members haven't accessed care yet). Management guided 82–83% for the full year. Q2–Q4 will look dramatically worse than Q1.
▼Enhanced ACA premium tax credits expired — Oscar's entire membership base is on individual market plans. Any meaningful loss of subsidies would shrink the addressable market and increase adverse selection risk in the risk pool.
▼House Judiciary subpoena scrutinizes premium increases. Regulatory pressure on rate adequacy could force Oscar to hold rates below medical cost inflation — directly compressing MLR and the profitability trajectory.
▼Revenue missed estimates by 5% ($4.65B vs $4.89B) despite the EPS beat. Net risk adjustment transfers are unpredictable and can significantly distort top-line comparisons — creating model uncertainty for analysts.
▼FY2025 was a painful reminder that MLR can spike rapidly — 87.4% MLR in 2025 vs 81.7% in 2024 caused a $443M net loss. Market morbidity is difficult to predict, and a repeat in 2026 would wipe out the entire profitability thesis.
Analyst Coverage — Post Q1 2026
Wall Street Ratings
| Firm / Source | Rating | Price Target | Note |
|---|
| Seeking Alpha (First Principles) | Strong Buy | $30.00 | Raised from prior; "best Q1 scenario we could hope for" |
| Consensus (bullish end) | Buy | $23.00 | Most bullish Street target |
| Analyst Consensus | Mixed | $15.40 | Simply Wall St consensus — 26% downside at current price |
| Bear End | Cautious | $10.00 | Lowest published target — policy + valuation concern |
| Stock Performance (30D) | +47% | ~$20+ | +65% over 90 days · +197% over 3 years |
Earnings Verdict
Speculative Buy · Profitability Thesis Confirmed — ACA Risk Remains
Q1 2026 was the quarter Oscar needed to deliver, and it delivered decisively. The 70.5% MLR proves that 2025's margin collapse was cyclical, not structural — disciplined pricing and AI-driven care management are working. The EPS beat of 86% and record $679M net income in a single quarter shift the narrative from "can Oscar be profitable?" to "how durable is the profitability?" The bear case is real and specific: Q1 MLR seasonality means Q2–Q4 will be dramatically higher (management guides 82–83% for the full year), ACA subsidy risk is a genuine overhang, and the regulatory environment is tightening. But with $8.1B in cash, 3.17M members, and a FY2026 guidance of $18.7–19.0B in revenue with $250–450M earnings from operations, the structural case has never been stronger. Position sizing discipline required — policy risk is binary.
Earnings Verdict
Spec. Buy