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Omada Health, Inc. (OMDA)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 revenue grew 49% year over year to $68.03M on 53% membership growth to 831k; GAAP gross margin expanded to 66.3% and non-GAAP gross margin to 68.2% .
  • Omada delivered its first quarter of positive adjusted EBITDA at $2.38M, while narrowing GAAP net loss to $3.18M .
  • The company raised FY25 guidance: revenue to $251.5–$254.5M (from $235–$241M) and adjusted EBITDA to -$2M to breakeven (from -$9M to -$5M) — a clear positive surprise and likely stock reaction catalyst .
  • Consensus vs. actuals: revenue beat Q3 by ~$6.8M and Q2 by ~$5.9M; Primary EPS comparisons are complicated by differing definitions (company reports GAAP EPS of -$0.06 while S&P “Primary EPS” differs), but directionally improved; we anchor on revenue outperformance as the cleanest signal (values with * from S&P Global) .

What Went Well and What Went Wrong

What Went Well

  • Record operating leverage: revenue +49% Y/Y with GAAP gross margin up ~350 bps to 66.3% and first positive adjusted EBITDA; management attributed margin gains to the self-built care platform and AI tools improving care team efficiency .
  • Strategic expansion in GLP-1: announced a prescribing offering integrated with the GLP-1 Care Track, targeting “the right member on the right medication at the right time” across 50 states .
  • AI product velocity: launched Meal Map and built on OmadaSpark to drive engagement and personalization; “We plan to keep weaving AI into many layers of our program” .

Selected quotes:

  • “Our third quarter results demonstrate the strength of Omada’s multi-product platform...” .
  • “2026 [will be] the year of the Gs… GLP-1s and GPTs and broader AI” .

What Went Wrong

  • GAAP still loss-making: net loss was $3.18M in Q3; despite sequential improvement, profitability remains a journey .
  • Cash declined sequentially to $198.6M primarily due to paying off ~$30M of debt (a strategic de-leveraging move), reducing flexibility near term versus Q2 levels .
  • Hardware drag persists: hardware revenue of $5.09M versus hardware cost of $10.31M implies negative hardware gross margin in Q3; management’s model relies on services margins to offset device economics .

Financial Results

Headline P&L, Margins, Cash

MetricQ1 2025Q2 2025Q3 2025
Revenue ($M)$54.963*$61.371 $68.030
GAAP Net Income (Loss) ($M)$(9.448)*$(5.311) $(3.178)
GAAP Diluted EPS ($)$(1.146)*$(0.24) $(0.06)
GAAP Gross Margin %58.0%*65.7% 66.3%
Non-GAAP Gross Margin %n/a67.7% 68.2%
Adjusted EBITDA ($M)n/a$(0.161) $2.383
Cash & Equivalents ($M)$59.397*$223.146 $198.627

Values marked with * retrieved from S&P Global.

Notes: Company defines adjusted EBITDA and non-GAAP gross margin as per its non-GAAP policy; reconciliations provided in the press release .

Segment Revenue Mix

Revenue ($M)Q3 2024Q2 2025Q3 2025
Services$42.096 $56.960 $62.936
Hardware$3.419 $4.411 $5.094
Total$45.515 $61.371 $68.030

KPIs and Operating Metrics

KPIQ2 2025Q3 2025
Total Members (end of period)752,000 831,000
Net New Members (quarter)73,000 79,000
GAAP Gross Margin %65.7% 66.3%
Adjusted EBITDA Margin %(0.3)% 3.5%

Member definition (billing event in prior 12 months) per company key metric disclosure .

Results vs. S&P Global Consensus

MetricQ2 2025Q3 2025
Revenue Consensus Mean ($M)$55.451*$61.223*
Revenue Actual ($M)$61.371 $68.030
Primary EPS Consensus Mean ($)$(0.126)*$(0.068)*
GAAP EPS Actual ($)$(0.24) $(0.06)
Revenue – # of Estimates6*7*
Primary EPS – # of Estimates6*6*

Values marked with * retrieved from S&P Global.

Implication: Clear revenue beats in both Q2 and Q3; EPS comparability is complicated by differing EPS definitions (company GAAP vs. S&P “Primary EPS”).

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueFY 2025$235M – $241M $251.5M – $254.5M Raised
Adjusted EBITDAFY 2025$(9)M – $(5)M $(2)M – $0M Raised

Company reiterated inability to reconcile forward adjusted EBITDA to GAAP net loss due to variability of excluded items .

Earnings Call Themes & Trends

TopicQ1 2025 (prior)Q2 2025 (prior)Q3 2025 (current)Trend
AI/Technology initiativesn/aLaunched OmadaSpark (AI agent) for nutrition/motivational interviewing; early engagement gains Launched Meal Map; continued AI integration incl. care team tools Expanding productization of AI
GLP-1 strategyn/aStrong GLP-1 Care Track momentum; persistence/outcomes data shared Announced GLP-1 prescribing capability integrated with care; enterprise model; branded meds fulfillment Deepening/verticalizing GLP-1 offering
Selling season & pipelinen/aCVS listing and pipeline building; H2 “closing season” Double-digit deal volume growth Y/Y; 180k individuals via new channel; 75% multi-product attach Pipeline scaling via channels
Profitability/marginsn/aGM 68% non-GAAP; approaching breakeven First positive adjusted EBITDA; long-term 70% GM and 20%+ EBITDA margin target reiterated Margin structure improving
Balance sheet/debtn/aIPO proceeds; debt paydown after Q2 Cash lower due to debt repayment; no debt outstanding Strengthened balance sheet
Policy/regulatoryn/a—Commentary on Medicare/price headlines; flexibility to help members find best price Watching potential coverage/price shifts

Note: No Q1 earnings call transcript available in our set; thus marked n/a.

Management Commentary

  • CEO: “We also took important steps to deepen our innovation in GLP-1 care options and advance our AI capabilities, both aimed at delivering meaningful and sustainable outcomes for our members and cost savings for customers.”
  • CEO on strategy: “2026… the year of the Gs. The first G is GLP-1s… The second G is GPTs and broader AI.”
  • President on AI: Meal Map “combines instant nutrient feedback with personalized guidance… Early observations include signs of higher engagement and more consistent meal tracking” .
  • CFO on margins/targets: “Our goal… is to get to 70% annualized gross margins… remain committed to hitting a +20% EBITDA margin” .

Q&A Highlights

  • GLP-1 prescribing details: Enterprise model, branded meds via member’s chosen pharmacy; pricing to be incremental (intended to be revenue and margin accretive), specifics to come .
  • 2026 investment cadence: Expect increased OpEx (R&D, S&M) to stand up prescribing and GLP-1/AI enhancements; more specifics by March call .
  • Seasonality: Q4 sequential revenue modestly higher but seasonally slower around holidays; focus on pipeline build into 2026 .
  • Multi-product attach and pipeline: Continued traction; double-digit Y/Y deal volume; 75% of new channel customers taking multiple programs .
  • Gross margin ambitions intact alongside new offerings; AI expected to support efficiency and ARPU over time .

Estimates Context

  • Revenue: Omada delivered material revenue beats vs. S&P Global consensus in Q2 and Q3 (see table), reflecting stronger-than-expected membership growth and commercialization of GLP-1 Care Track (values with * from S&P Global) .
  • EPS: Company reports GAAP EPS; S&P “Primary EPS” may reflect a different definition/normalization, so we anchor on revenue beats as the more comparable indicator while noting GAAP EPS improved sequentially in Q3 .
  • Street recalibration: Raised FY25 revenue and adjusted EBITDA guidance should drive upward estimate revisions for 4Q and FY25, with 2026 margin commentary setting constructive expectations .

Key Takeaways for Investors

  • Broad-based growth with operating leverage: revenue +49% Y/Y, GAAP gross margin 66.3%, first positive adjusted EBITDA — a key inflection .
  • Guidance raised on both top line and adjusted EBITDA, signaling sustained momentum into 4Q and 2026 .
  • Strategic moat expanding via GLP-1 prescribing and AI (Meal Map, OmadaSpark), improving differentiation and potential ARPU/retention .
  • Channel scale building (new partner reach ~180k individuals; 75% multi-product attach) supports durable membership growth into 2026 .
  • Watch hardware economics (negative hardware gross margin) and continued GAAP losses even as adjusted metrics inflect; services margin mix remains critical .
  • Cash of ~$199M post debt paydown provides runway for 2026 investments (GLP-1/AI) without leverage overhang .
  • Near-term trading lens: narrative anchored on raised guide and first positive adjusted EBITDA; monitor 4Q seasonality and early prescribing traction updates .

Appendix — Non-GAAP definitions and reconciliations are provided by the company in the press releases .