Alight, Inc. / Delaware (ALIT) · Nov 3, 2026 · Earnings
Beat — Revenue $500M vs. $469M-$479M guide; adjusted EBITDA $86M vs. $55M-$61M guide
Alight’s Q3 earnings beat its revenue and EBITDA guide, but recurring revenue, gross margin and cash flow all weakened year over year.
Alight is in the middle of an operational turnaround: it is trying to repair retention and commercial momentum through modernization, AI investment, insourcing and tighter account coverage after weaker commercial activity. Management had already warned that Q3 would carry seasonally higher expenses and reflect the commercial execution problems experienced in 2025.
The quarter beat the near-term bar by a wide margin. Revenue reached $500 million versus the prior $469 million-$479 million company range and roughly $474 million published consensus, while adjusted EBITDA reached $86 million versus the $55 million-$61 million guide. The revenue beat was about 5.5% over the midpoint of guidance, and EBITDA was roughly 48% above the guide midpoint. The company said it had “surpassed revenue and adjusted EBITDA expectations for the third consecutive quarter.”
| Q3 2026 | Q3 2025 | Q3 guide / consensus | |
|---|---|---|---|
| Revenue (Financial Highlights) | $500M (-6.2%) | $533M | $469M-$479M / ~$474M |
| Adjusted EBITDA (Adjusted EBITDA reconciliation) | $86M (-37.7%) | $138M | $55M-$61M |
| Adjusted EBITDA margin (Adjusted EBITDA reconciliation) | 17.2% (-8.7 pts) | 25.9% | |
| Recurring revenue (Revenue disaggregation) | $458M (-6.3%) | $489M | |
| Free cash flow (Free cash flow reconciliation) | $108M (-28.5%) | $151M |
The beat is operationally weaker than the headline suggests. Revenue still fell 6.2% year over year, with recurring revenue down 6.3%, meaning the core contracted base has not yet returned to growth. Gross profit fell to $135 million from $178 million, while adjusted gross margin dropped to 33.6% from 38.6%. Alight attributed the gross-profit decline to lower revenue and higher compensation expense.
Cost pressure remains the central tension in the turnaround. Adjusted EBITDA beat the deliberately low Q3 guide, but still declined 38% year over year, and SG&A increased $35 million because of severance, restructuring, compensation and professional fees. That makes this more a successful delivery against a cautious reset than evidence that the business has regained its old earnings power.
The balance sheet is manageable but cash conversion weakened. Operating cash flow from continuing operations was $181 million for the first nine months, but free cash flow fell to $108 million from $151 million, while cash and equivalents declined to $212 million from $273 million and long-term debt remained near $2.0 billion. The large improvement in GAAP loss is not the key signal because the prior-year comparison included a $1.338 billion non-cash goodwill impairment.
Bottom line: Alight beat a low Q3 operating bar decisively, which modestly advances the turnaround story. But the underlying business is still shrinking and losing margin, so this is a delivery beat—not yet proof that the commercial recovery is complete.
Q4 results and 2027 outlook
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