Hinge HealthHNGE

Hinge Health reported $213 million in revenue for the quarter, a 53 percent jump from last year that came in ahead of what analysts expected. The company brought in $100 million in free cash flow, which is the cash left over after paying for its operations. This was three times higher than the same period last year, showing that the business is becoming much more efficient as it grows.

Management also announced it is buying Cylinder Health for $105 million in cash. Cylinder provides virtual care for digestive issues, which affect about one in four adults. This move allows Hinge Health to sell more services to its existing employer clients beyond its core back and joint pain programs. Based on the strong results, the company raised its full-year revenue goal to about $858 million.

See the full quarter, and how our tracked metrics did

Source: 8-K filing

Key highlights

• Profitability outlook raised: Management raised its full year revenue guidance to a midpoint of $858 million, which would be 46% growth over last year. The company also expects to earn up to $244 million in non-GAAP operating income, meaning the profit left after running the business but excluding things like stock-based pay, as it gains more scale from its existing customers.
• Efficiency gains driving margins: The company reported a non-GAAP gross margin of 87%, a jump from 83% a year ago. This expansion shows the company is getting more efficient at delivering its virtual care programs even as it rolls out new services like the Migraine Care Program.
• Customer base expanding: The total number of clients grew 24% to 2,929 businesses and organizations. This growth matters because adding more employers to the platform provides the foundation for more people to sign up for its health programs over time.
• Cash flow triples: Free cash flow, which is the cash left over after paying for operations and equipment, rose to $99.6 million from $32.6 million last year. This increase in cash helped the board approve a $300 million addition to its share repurchase program, where the company buys back its own stock to return value to owners.
• New digestive care expansion: The company signed an agreement to acquire Cylinder Health for $105 million in cash to enter the gastrointestinal health market. This move allows the company to move beyond its core bone and joint care and provide support for more health conditions in a single app starting in 2027.

Our take: A very strong quarter that shows the business is maturing into a highly profitable platform. While revenue growth remains fast at 53%, the real story is how quickly cash flow and margins are expanding as the company scales. This performance reinforces the long term case for its digital health model.