Alignment Healthcare Surpasses Expectations with Strong Q3 Performance and Raised 2025 Outlook

Alignment Healthcare, a Medicare Advantage insurtech company, has reported exceptional third-quarter results for 2025, showcasing robust growth and improved financial performance. The company's success has led to an increased full-year outlook, positioning it as a strong player in the evolving Medicare Advantage landscape.

Q3 Financial Highlights and Membership Growth

Alignment Healthcare reported third-quarter revenue of $993.7 million, representing a 44% year-over-year increase. The company also achieved a significant turnaround in profitability, posting a net income of $3.7 million, or 2 cents per share, compared to a loss of $26 million in the same quarter last year. These results surpassed Wall Street expectations, with analysts anticipating a loss of 7 cents per share and revenue of $980.9 million.

The company's health plan membership grew to 229,600, marking a 26% increase from the previous year. This growth in membership, coupled with effective medical cost management, contributed to an adjusted gross profit of $127 million, up 58% year-over-year. Alignment Healthcare also reported an improved consolidated medical benefits ratio (MBR) of 87.2%, representing a 120 basis point enhancement over the prior year.

Technology-Driven Operational Improvements

CEO and founder John Kao attributed the company's success to its unique model and continued investments in operational improvements. Key focus areas include back-office automation, clinical engagement, and the utilization of their proprietary AVA (Alignment's Virtual Applications) AI platform for clinical stratification and Stars durability.

The AVA technology platform, used in conjunction with the company's Care Anywhere program, has been instrumental in filling care coordination gaps and improving preventive treatment for polychronic individuals. This technological edge has helped Alignment Healthcare maintain high-quality ratings, with 100% of its health plan members enrolled in plans rated 4 stars or higher for the 2026 plan year.

Raised Full-Year Outlook and Future Growth Prospects

Following its strong Q3 performance, Alignment Healthcare has raised its full-year outlook for 2025 across several key metrics. The company now projects annual revenue between $3.93 billion and $3.95 billion, an increase of $41 million at the midpoint compared to previous forecasts. Adjusted gross profit is expected to range from $474 million to $483 million, with adjusted EBITDA forecasted between $90 million and $98 million.

Looking ahead to 2026, company executives expressed confidence in sustaining membership growth of 20% or greater, based on early annual enrollment period results and competitive market dynamics. Alignment Healthcare is also exploring opportunities for geographic expansion, considering both new markets within existing state footprints and potential new states for 2027.

As the Medicare Advantage industry continues to evolve, Alignment Healthcare's differentiated model and strong performance position it well for continued growth and market share gains in the coming years.