Sign in

You're signed outSign in or to get full access.

SI

SelectQuote, Inc. (SLQT)·Q1 2026 Earnings Summary

Executive Summary

  • Revenue of $328.8M (+12.5% YoY) beat consensus by ~$5.1M; EPS of -$0.26 was modestly better than consensus (-$0.27). Adjusted EBITDA of -$32.1M missed company’s prior guide for a -$25M to -$30M loss, driven by SelectRx reimbursement pressure in 1H FY26 . Consensus comparison from S&P Global estimates*.
  • Guidance maintained: FY26 revenue $1.65–$1.75B and Adjusted EBITDA $120–$150M; Healthcare Services expected ~breakeven EBITDA in Q2 with an FY26 exit run-rate of $40–$50M as rates normalize from Jan 1, 2026 .
  • Segment mix: Healthcare Services grew revenue +42% YoY with members at 106,914; Senior revenue fell -37% due to SEP eligibility changes; Life grew revenue +19% with solid profitability .
  • Near-term stock catalysts: clarity on PBM reimbursement renegotiation and AEP performance trajectory; management reiterated confidence in integrated healthcare model and stable FY26 outlook despite 1H headwinds .

What Went Well and What Went Wrong

What Went Well

  • Healthcare Services revenue +42% YoY to $221.4M; SelectRx members +24% YoY to 106,914; prescriptions/day rose to 31,378, evidencing demand and scale benefits .
  • “We are not changing our fiscal 2026 financial outlook of $1.65 to $1.75 billion in revenue and $120 to $150 million in Adjusted EBITDA*” — CEO Tim Danker, underscoring model resilience despite temporary rate pressure .
  • CAC multiple reached 6.4x (all-time high), nearly 40% higher YoY, indicating strong marketing efficiency and customer value creation within the ecosystem .

What Went Wrong

  • Consolidated Adjusted EBITDA of -$32.1M missed internal guide (-$25M to -$30M) on SelectRx reimbursement headwinds; management expects Q2 Healthcare Services EBITDA ~breakeven before normalization .
  • Senior segment revenue fell -37% YoY to $59.0M and swung to -$21.0M Adjusted EBITDA due to new SEP eligibility rules and ramp investment ahead of AEP/OEP .
  • LTV per MA policy declined 5% YoY to $769, reflecting commission mix and market dynamics; LTV for “all other” policies fell -19% YoY to $133 .

Financial Results

Consolidated Results vs prior quarters

MetricQ3 2025Q4 2025Q1 2026
Revenue ($USD Millions)$408.2 $345.1 $328.8
EPS (Basic) ($USD)$0.11 $(0.02) $(0.26)
EPS (Diluted) ($USD)$0.03 $(0.02) $(0.26)
Adjusted EBITDA ($USD Millions)$37.7 $2.7 $(32.1)

Consensus vs Actual (select periods) — S&P Global estimates

MetricQ3 2025Q4 2025Q1 2026
Revenue Consensus Mean ($USD)$412.8M*$334.1M*$323.7M*
Revenue Actual ($USD)$408.2M*$345.1M*$328.8M*
Primary EPS Consensus Mean ($USD)$0.023*$(0.203)*$(0.267)*
Primary EPS Actual ($USD)N/A*$0.035*$(0.238)*
EBITDA Consensus Mean ($USD)$36.0M*$(2.2)M*$(19.6)M*
EBITDA Actual ($USD)$25.0M*$(5.4)M*$(38.5)M*

Values retrieved from S&P Global.*

Segment Performance (Q1 YoY)

SegmentQ1 2025 Revenue ($USD 000s)Q1 2026 Revenue ($USD 000s)YoY ChangeQ1 2025 Adj. EBITDA ($USD 000s)Q1 2026 Adj. EBITDA ($USD 000s)Adj. EBITDA Margin (Q1 2026)
Senior$92,908 $58,996 (37)%$7,724 $(21,036) (36)%
Healthcare Services$155,739 $221,351 42%$4,878 $7,212 3%
Life$39,290 $46,647 19%$5,960 $5,570 12%

KPIs and Operating Metrics

KPIQ1 2025Q1 2026
Senior — Submitted MA Policies102,281 70,240
Senior — Approved MA Policies91,680 62,510
Senior — LTV per Approved MA Policy ($)$812 $769
Healthcare Services — SelectRx Members86,521 106,914
Healthcare Services — Prescriptions per Day24,998 31,378
Life — Term Premiums ($USD 000s)$15,218 $19,443
Life — Final Expense Premiums ($USD 000s)$24,473 $29,429

Sequential Healthcare Services Trend (last 5 quarters)

MetricQ1 2025Q2 2025Q3 2025Q4 2025Q1 2026
SelectRx Members (000s)87 97 106 108 107
Revenue ($USD Millions)$156 $183 $190 $214 $221
Adjusted EBITDA ($USD Millions)$5 $2 $6 $12 $7

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueFY 2026$1.65–$1.75B $1.65–$1.75B Maintained
Adjusted EBITDAFY 2026$120–$150M $120–$150M Maintained
Healthcare Services Adjusted EBITDAQ2 FY 2026Not specified~Breakeven Lower near-term
Healthcare Services EBITDA run-rateFY 2026 Exit“> $50M” (FY26 EBITDA expected) $40–$50M exit run-rate Lowered exit run-rate
Consolidated Adjusted EBITDAQ1 FY 2026-$25M to -$30M (guide) Actual -$32.1M Miss vs guide

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 & Q4 FY25)Current Period (Q1 FY26)Trend
PBM/Reimbursement DynamicsFocus on scaling SelectRx; margin expansion path with new Kansas facility; FY26 Healthcare Services EBITDA >$50M targeted One PBM reimbursement change impacts 1H FY26 (~$20M), Q2 segment EBITDA ~breakeven; rates normalize Jan 1, 2026; exit run-rate $40–$50M Near-term headwind; normalization expected
AEP/OEP Market BackdropImproved CMS final rate notice; carriers focused on profitability; tech-driven agent efficiency Elevated plan disruption, strong consumer engagement; retention focus; tenured agents performing well Dynamic but supportive for agent-led model
AI/Technology EnablementAutomation and AI lifting agent productivity; 25% enrollment time reduction; 300k+ AI-powered interactions Continued use of AI across recruiting, training, QA, retention; improving cost effectiveness Ongoing leverage and scaling
Capital Structure/Cash FlowSecuritization and preferred equity lowered cost of capital; aim for positive operating cash flow in FY26 Reiterate operating cash flow positive in FY26 despite 1H headwinds Positive trajectory
SDOH/Healthcare Select Insights—Research highlights underserved populations, adherence challenges; SelectRx addresses access and adherence gaps Strategic content, supports partner discussions

Management Commentary

  • “The strength of our integrated healthcare model was exhibited again… we are not changing our fiscal 2026 financial outlook of $1.65 to $1.75 billion in revenue and $120 to $150 million in Adjusted EBITDA*.” — CEO Tim Danker .
  • “Change in drug reimbursement rates with a SelectRx PBM partner… disproportionately impacts the first half of this fiscal year by approximately $20 million… Q2 adjusted EBITDA for healthcare services to be approximately break-even.” — CEO Tim Danker .
  • “Our agile agent-led approach delivered outsized growth per agent and near-record margins… we entered the season with excellent retention of tenured agents… optimistic for strong AEP and OEP.” — CEO Tim Danker .
  • “Revenue to customer acquisition cost (CAC) ratio of 6.4x… an all-time high and nearly 40% higher than a year ago.” — CEO Tim Danker .

Q&A Highlights

  • RBC on PBM headwinds: Management underscored constructive negotiations with PBM, long-term economics intact, and rate normalization from Jan 1, 2026 .
  • RBC on MA LTV impact: Persistency improves with SelectRx attachment but not booked into LTV; attachment cohort is specific, limiting aggregate impact .
  • NOBLE on retention strategy: Extensive use of AI, data history, and proactive outreach to recapture members amid industry-wide plan changes .
  • Craig-Hallum on AEP market: Broad carrier pullbacks to prioritize profitability; SelectQuote sees high engagement and benefits from simplifying offerings (e.g., HMOs) .
  • SelectRx growth vs profitability: Focus on member quality and clinical programs (Adherence for All) to accelerate adherence and margins; measured growth with strong partner alignment .

Estimates Context

  • Q1 FY26: Revenue beat (~$328.8M vs $323.7M*); EPS was less negative than expected (-$0.238* vs -$0.267*); EBITDA missed (-$38.5M* vs -$19.6M*).
  • Q4 FY25: Revenue beat ($345.1M vs $334.1M*); EPS beat ($0.035* vs -$0.203*); EBITDA slightly worse than expected.
  • Q3 FY25: Revenue slight miss (~$408.2M vs $412.8M*); EBITDA below consensus (mix shift to lower-margin Healthcare Services).
    Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Revenue resilience amid Senior softness: Healthcare Services growth (+42% YoY) offset SEP-related Senior declines; integrated model supports consolidated top line .
  • Near-term EBITDA volatility likely contained to 1H: PBM reimbursement reset drives Q1 miss and Q2 breakeven in Healthcare Services; normalization expected from Jan 1, 2026 .
  • Guidance intact despite headwinds: FY26 ranges reaffirmed; management confidence tied to SelectRx clinical value and agent-led retention strategy .
  • AEP backdrop favorable for agent-led differentiation: Elevated disruption boosts consumer engagement; proactive retention and tenured agent mix should support volumes/margins .
  • CAC efficiency and SDOH differentiation underpin moat: 6.4x CAC multiple and adherence/health outcomes improvements strengthen payer relationships and cross-sell potential .
  • Watch catalysts: PBM renegotiation outcomes, AEP/OEP recapture rates, 2H margin rebound trajectory in Healthcare Services; potential capital structure optimization as cash flow improves .
  • Positioning: Bias to volatility near-term (EBITDA), with medium-term margin and cash flow normalization as SelectRx rates revert and scale efficiencies accrue .