Progyny (NASDAQ: PGNY) reported Q2 2026 revenue of $350.5 million, up 5.3% year over year, while GAAP diluted EPS rose to $0.34 from $0.19. Gross margin expanded to 25.5% from 23.7%, and net income increased to $28.1 million, supported by care-management efficiencies and lower stock-based compensation. For the quarter ended June 30 and reported on August 6, revenue growth was 11.0% after excluding $17.2 million contributed by a non-renewing large client in the prior-year quarter.
Core financial results
The client comparison reduced reported revenue growth even as Progyny added clients and covered lives. Profit increased faster than revenue because gross profit rose 13%, while GAAP operating expenses declined to $49.3 million from $54.6 million.
Adjusted EBITDA growth was closer to the top-line increase, reflecting planned investments in the platform. Quarterly operating cash flow declined because of working-capital timing.
| Metric | Q2 2026 | Q2 2025 | Year-over-year change |
|---|---|---|---|
| Revenue | $350.5 million | $332.9 million | +5.3% |
| Gross profit / margin | $89.3 million / 25.5% | $79.0 million / 23.7% | +13.0% / +1.8 percentage points |
| Operating income / margin | $40.0 million / about 11.4% | $24.4 million / about 7.3% | About +64.2% / +4.1 percentage points |
| Net income | $28.1 million | $17.1 million | About +64.0% |
| GAAP diluted EPS | $0.34 | $0.19 | About +78.9% |
| Adjusted diluted EPS | $0.55 | $0.48 | About +14.6% |
| Adjusted EBITDA / margin | $62.1 million / 17.7% | $57.9 million / 17.4% | +7.2% / +0.3 percentage points |
| Operating cash flow | $50.4 million | $55.5 million | About -9.2% |
Adjusted EPS, adjusted EBITDA and adjusted EBITDA margin are non-GAAP measures that exclude items including stock-based compensation.
Business and operating performance
Fertility benefit services remained the main growth driver, with revenue increasing 7.6%. Pharmacy benefit services grew only 1.2%, creating a clear difference between the two revenue streams.
Client and member growth was more substantial than the change in ART cycles. Utilization edged higher, while prior-year ART cycles included activity under the former large client’s transition agreement.
| Operating metric | Q2 2026 | Q2 2025 | Year-over-year change |
|---|---|---|---|
| Fertility benefit services revenue | $230.2 million | $213.9 million | +7.6% |
| Pharmacy benefit services revenue | $120.3 million | $118.9 million | +1.2% |
| Fertility and family-building clients | 604 | 542 | About +11.4% |
| Average members | 7.185 million | 6.743 million | About +6.6% |
| ART cycles | 16,998 | 16,938 | About +0.4% |
| Utilization, all members | 0.56% | 0.55% | +0.01 percentage point |
| Utilization, female only | 0.49% | 0.48% | +0.01 percentage point |
Approximately 300,000 members from one client are included in average members but excluded from utilization because of that client’s benefit design. Progyny also excludes the former large client’s transition activity from 2025 utilization, although the associated ART cycles remain in the prior-year cycle count.
Lower stock compensation amplified GAAP profit growth
Stock-based compensation declined to $20.5 million from $32.4 million, helping both gross margin and operating expenses. GAAP gross margin expanded by 1.8 percentage points, but gross margin excluding stock-based compensation rose by a smaller 0.6 percentage point, to 27.2% from 26.6%.
The same distinction appears in operating expenses. Reported sales and marketing plus general and administrative expenses fell to $49.3 million from $54.6 million. Excluding stock-based compensation, however, those expenses increased to approximately $35.0 million from $31.8 million, consistent with management’s statement that platform investments partially offset higher gross profit.
Adjusted EBITDA, which excludes stock-based compensation, consequently rose 7.2%, compared with the roughly 64% increase in GAAP net income. This indicates that the quarter’s underlying operational improvement was positive but more modest than the increase in reported earnings.
Cash flow, balance sheet and share repurchases
Operating cash flow was $50.4 million for the quarter, down from $55.5 million because of working-capital timing. Trailing-12-month operating cash flow was nearly unchanged at $201.2 million, compared with $202.0 million a year earlier.
Progyny ended June with $236.9 million in cash, cash equivalents and marketable securities, up $11.8 million from March 31. The company had approximately $272.9 million of working capital, no debt and an undrawn $200 million revolving credit facility.
During Q2, Progyny repurchased nearly 1.2 million shares for $31.5 million under its May 2026 program. It had repurchased 2 million shares under that authorization as of the earnings release, leaving approximately $142.5 million available. Across the May 2026 program and its predecessor program, total repurchases reached 10.8 million shares.
Financial guidance
Progyny provided guidance for Q3 and full-year 2026. The Q3 outlook incorporates a somewhat more pronounced seasonal decline in summer member engagement, followed by an assumption that September engagement returns to levels seen during the first half.
| Period | Metric | Latest guidance |
|---|---|---|
| Q3 2026 | Revenue | $335 million-$345 million; growth of 6.9%-10.1% |
| Q3 2026 | Net income / diluted EPS | $24.5 million-$26.7 million / $0.30-$0.33 |
| Q3 2026 | Adjusted EBITDA | $56 million-$59 million |
| Q3 2026 | Adjusted diluted EPS | $0.50-$0.52 |
| Full-year 2026 | Revenue | $1.360 billion-$1.385 billion; growth of 5.5%-7.5% |
| Full-year 2026 | Net income / diluted EPS | $104.8 million-$109.9 million / $1.26-$1.32 |
| Full-year 2026 | Adjusted EBITDA | $233 million-$240 million |
| Full-year 2026 | Adjusted diluted EPS | $2.04-$2.10 |
Excluding $48.5 million of 2025 revenue from the former large client’s transition agreement, full-year revenue growth is projected at 9.7% to 11.7%. Guidance also assumes 6.9 million average members, female utilization of 1.04% to 1.05%, and 66,700 to 68,000 ART cycles for 2026.
Management commentary
CEO Pete Anevski said member engagement reached the higher end of the company’s expectations during Q2. Management also reported that new lives and the expected contribution from early selling-season commitments were running meaningfully ahead of the same point last year.
Based on renewal commitments received by the release date, Progyny said it had removed most of the client-retention risk involving its largest accounts. CFO Mark Livingston emphasized that operating cash generation continued to give the company room to invest in its platform while repurchasing shares.
Recent insider transactions
The supplied six-month summary reports 392,152 shares purchased across 15 transactions and 49,013 shares sold across 12 transactions, for net purchases of 343,139 shares. The 10 latest reported entries consist of eight sales and two derivative-security exercises; the supplied data did not specify the unit of the reported transaction amounts.
| Date | Insider and role | Transaction | Price per share | Reported amount |
|---|---|---|---|---|
| Jul. 14, 2026 | Melissa B. Cummings, COO | Sale | $31.60 | 70,910 |
| Jun. 4, 2026 | Mark S. Livingston, CFO | Sale | $25.50 | 64,184 |
| Jun. 4, 2026 | Allison Swartz, General Counsel | Sale | $25.02-$25.08 | 45,022 |
| Jun. 2, 2026 | Mark S. Livingston, CFO | Sale | $26.20 | 7,310 |
| Jun. 2, 2026 | Geoffrey Clapp, Officer | Sale | $25.58 | 39,137 |
| Jun. 2, 2026 | Geoffrey Clapp, Officer | Derivative exercise/conversion | $20.91 | 269,927 |
| Jun. 1, 2026 | Cheryl M. Scott, Director | Sale | $26.38 | 196,278 |
| Jun. 1, 2026 | Cheryl M. Scott, Director | Derivative exercise/conversion | $13.00 | 190,671 |
| May 28, 2026 | Allison Swartz, General Counsel | Sale | $25.46 | 61,053 |
| May 27, 2026 | Kevin K. Gordon, Director | Sale | $24.99 | 137,445 |
These transactions are presented as reported and do not, by themselves, establish insiders’ views about Progyny’s outlook.
Risks investors should watch
- Client concentration and renewals: The loss of one large client reduced the reported growth rate, demonstrating the financial effect that a major non-renewal can have even as management reports favorable progress with current large accounts.
- Utilization and seasonality: Revenue depends on member engagement, and Q3 guidance assumes a more pronounced summer slowdown before engagement returns to first-half levels in September.
- Earnings quality and expense trends: Lower stock-based compensation materially supported GAAP margin and net-income growth, while operating expenses excluding that item increased as Progyny invested in its platform.
- Uneven service growth: Pharmacy benefit revenue grew 1.2%, well below the 7.6% increase in fertility benefit revenue, leaving consolidated growth more dependent on the fertility business.
- Working-capital volatility: Quarterly operating cash flow declined despite higher earnings, with management attributing the difference to the timing of working-capital items.
Summary
Progyny’s Q2 results combined moderate reported revenue growth with wider margins and much faster GAAP profit growth. Client and member additions, fertility benefit revenue and delivery efficiencies supported the quarter, while the comparison with a departed large client obscured higher underlying revenue growth. Investors’ next focal points are selling-season commitments, large-client retention, summer utilization, the durability of margins beyond lower stock-based compensation, and execution against the company’s 2026 guidance.
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