The headline upgrade is real, but it is mainly a revenue reset. Starling raised its 2026 revenue range by $20 million at both ends and lifted gross-profit guidance, while free-cash-flow guidance stayed unchanged and the adjusted-EBITDA midpoint remained $4.5 million. That makes this a narrow guidance positive rather than a broad profitability re-rating. (2026 Guidance — Previous / Updated)
| Metric | Q2 2026 | Q2 2025 | 2026 updated guide | Prior guide |
|---|---|---|---|---|
| Total operating revenue | $161.3M | $119.8M | $650–670M | $630–650M |
| Adjusted EBITDA | $0.2M | $(4.1)M | $2–7M | $0–9M |
| Free cash flow, six months | $9.5M | $(14.6)M | $5–15M | $5–15M |
| Capitated revenue, Q2 | $28.0M | $18.8M | — | — |
| Medical loss ratio | 85.5% | 71.0% | 80–90% next 12 months | — |
| Cash and equivalents | $41.1M | — | — | — |
| Long-term debt | $79.9M | — | — | — |
Growth is accelerating in the company’s preferred business model. Second-quarter revenue increased 35% year over year and adjusted EBITDA turned slightly positive. 〔0〕 Capitated revenue rose 48.5% to $28.0 million, and management now expects roughly $150 million of capitated revenue for 2026. (Financial Highlights; Segment results — Patient services)
The main offset is worsening medical-cost performance. The capitated medical loss ratio climbed to 85.5% from 71.0%, meaning a larger share of capitated revenue is being consumed by patient-care costs before overhead. Management’s stated 80%–90% range leaves room for further deterioration, so the revenue upgrade does not yet translate into a cleaner margin story. (Financial Highlights; Non-GAAP Financial Measures)
Cash generation improved materially, but the balance sheet remains constrained. Six-month operating cash flow swung to $9.7 million from $(15.2) million, producing $9.5 million of free cash flow, while cash ended at $41.1 million against $79.9 million of long-term debt and total liabilities above assets. (Cash Flow statement; Balance Sheet)
Net read: better than the prior standing outlook, but not a decisive earnings inflection. With no external consensus supplied, the clearest benchmark is the company’s previous guidance: revenue and gross profit were raised, but the EBITDA range narrowed around the same midpoint and free-cash-flow expectations were unchanged. The filing therefore supports a narrowly positive read driven by growth and execution, with medical-cost control still unresolved.
Read the original 8-K on SEC EDGAR ↗