Shares of Hinge Health surged 11.9% to $88.90 after the digital healthcare company delivered a second quarter that handily beat expectations, hiked its annual outlook for the third consecutive time, and unveiled a $105 million deal to push into digestive care. The combined package signals a company accelerating on all fronts — but the stock's run from roughly $74 a week ago raises the question of how much good news is already priced in.
A Quarter That Blew Past Every Benchmark. Hinge Health posted Q2 revenue of $213 million, up 53% year over year and well above its prior guidance range of $200–$202 million.
Earnings came in at $0.59 per share versus Wall Street's $0.13 estimate.
Operating margin expanded to 29%, up from 19% a year ago , showing the company can grow fast and widen profits simultaneously — a rare combination in digital health. Free cash flow climbed to $100 million over the past twelve months, up from $33 million a year prior.
The Guidance Raise Keeps Getting Bigger. Management now expects $856–$860 million in 2026 revenue, reflecting 46% year-over-year growth — up from the $818–$824 million range set just two months ago at its investor day. For Q3, the company guided to $223–$225 million in revenue and lifted full-year operating income to $236–$244 million. Each guidance raise has been driven largely by higher "member yield" — essentially, more enrolled users are actually using the service, which converts to revenue without proportional cost increases.
A $105 Million Bet on Stomachs, Not Just Spines. The acquisition of Cylinder Health adds a virtual digestive-care program alongside Hinge's existing muscle-and-joint and migraine services. Gastrointestinal conditions affect one in four U.S. adults and drive $135 billion in annual medical spending.
Cylinder is expected to contribute only $7–$8 million in revenue for the rest of 2026, implying roughly $20–$25 million annualized.
Management concedes Cylinder will initially run at a loss but aims to match Hinge's own profit profile within one to two years, with integration targeted for summer 2027.
Buybacks Signal Confidence — and Cash to Spare. The board expanded share repurchase authorization to $550 million, with $196.5 million already completed , a clear message that management believes the stock remains undervalued even after its run. That conviction, backed by triple-digit free-cash-flow growth, gives the company firepower to fund both acquisitions and returns without diluting shareholders.