Ethos Q3 Results Show Accelerating Momentum
Ethos Q3 results prompted higher full-year and Q4 revenue targets and stronger adjusted profitability and cash flow, likely shifting investor positioning.
KEY TAKEAWAYS
- Ethos posted record Q3 revenue of $235 million, up 151% year over year.
- Adjusted EBITDA rose to $35 million, a 15% margin, and operating cash flow strengthened.
- The company raised Q4 revenue guidance to $220 million-$224 million and full-year to $838 million-$842 million.
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Ethos Technologies Inc. (LIFE) reported a record third quarter on Nov. 2, 2026, prompting the company to raise its fourth-quarter and full-year revenue guidance. The surge reflected broad strength across direct and third-party channels, along with improved adjusted profitability and cash flow.
Record Quarter and Profitability
Ethos posted total revenue of $235.2 million for the quarter ended Sept. 30, 2026, a 151% increase year over year. Adjusted EBITDA rose 87% to $34.9 million, representing a 15% margin. Operating activities generated $40.7 million in net cash, signaling stronger profit conversion.
The company reported GAAP net income of $4.7 million, a 2% margin, with basic and diluted earnings per share of $0.07. Non-GAAP net income was $33.8 million, a 14% margin, and diluted non-GAAP earnings per share reached $0.49.
Guidance and Distribution Mix
Ethos raised its fiscal 2026 revenue guidance to a range of $838 million to $842 million and set fourth-quarter revenue guidance between $220 million and $224 million. The company also forecast adjusted EBITDA of $30 million to $32 million for the fourth quarter and $134 million to $136 million for the full year. Management said third-quarter revenue and adjusted EBITDA each exceeded the midpoint of August guidance by 45%.
Revenue growth came from both distribution channels. Direct-channel revenue increased 112% year over year to $118.8 million, while third-party-channel revenue rose 209% to $116.4 million, accounting for roughly half of the quarter’s total revenue.
Ethos activated 142,111 new policies in the quarter, bringing cumulative activated policies to more than 850,000. Average revenue per policy declined 13% year over year to $1,655, reflecting a shift toward whole-life products in the third-party channel. The company posted a contribution profit of $66.4 million, a 28% margin, and gross profit of $230.8 million, a 98% margin. Management highlighted a Rule of 40 score of 166, combining revenue growth and adjusted EBITDA margin.
The quarter’s revenue surge, rising adjusted profitability, and positive operating cash flow supported the company’s decision to raise its revenue targets, setting the tone for investor expectations in the fourth quarter.
“Q3 was a record quarter for Ethos,” said Chief Executive Officer Peter Colis.
