Omada: Virtual-First Healthcare

Omada S1 Deep Dive

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Rohit Malhotra
June 26, 2025

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S1 Deep Dive

Omada in one minute

In a nation overwhelmed by chronic disease, Omada Health is quietly redefining how care is delivered—between visits, at scale, and with measurable impact. Founded with a single goal—to bend the curve of chronic illness—Omada blends behavior science, compassionate clinical care, and intelligent technology to deliver ongoing, virtual-first support for people managing diabetes, hypertension, obesity, and musculoskeletal conditions.

Built for the gaps traditional healthcare can't reach, Omada operates with a dual model: as a direct partner to employers and health plans, and as a channel partner to PBMs and health systems. The company’s reach has grown steadily—over 2,000 enterprise customers, 1 million members served, and industry-leading engagement metrics—with more than half of members still active after two years.

With $170M in 2024 revenue and 128% net dollar retention, Omada is scaling fast. Its model drives value not just for members, but for the ecosystem that pays for their care. And its results speak for themselves: 90%+ customer satisfaction, 30+ interactions per member per month, and a product suite now spanning cardiometabolic, physical therapy, GLP-1 support, and behavioral health.

Introduction

Omada Health operates across three foundational pillars: human-led Care Teams, an intelligent technology platform, and the Omada Insights Lab. Together, they power a virtual-first care model built to close the gap between doctor’s visits and deliver better outcomes for people managing chronic conditions like diabetes, hypertension, and musculoskeletal issues.

Omada’s Between-Visit Care model was purpose-built to deliver personalized, scalable, and clinically validated support between traditional touchpoints in the U.S. healthcare system. Its Care Teams—comprising licensed professionals like health coaches, specialists, and physical therapists—provide continuity and trust, helping members make lasting behavior changes over time. These professionals do not replace physicians but operate within their scope to offer proactive, relational care that members can access anywhere, anytime.

The company’s integrated technology platform plays a central role in amplifying care. It enables real-time data tracking, personalized recommendations, and seamless engagement across devices. Supported by third-party integrations, Omada’s platform allows for continuous feedback loops and measurable clinical outcomes, even at scale. All insights feed into the Omada Insights Lab—a cross-functional team spanning clinical, engineering, and product domains—which ensures that innovation is continuous and data-driven.

Omada’s multi-condition platform is designed to reflect how chronic conditions actually occur: concurrently and interactively. Rather than building siloed “point solutions,” Omada delivers coordinated care tailored to comorbidities—such as hypertension and diabetes or MSK issues and obesity—through a unified member experience. This approach allows employers, health plans, and PBMs to simplify vendor management while enhancing care effectiveness across large populations.

The company has anchored its model in evidence from day one. Omada’s programs are based on proven clinical interventions and validated through 29 peer-reviewed studies. The company holds accreditations from multiple industry bodies, including the CDC, NCQA, ADCES, and URAC—affirming its credibility in the broader healthcare ecosystem.

With over 2,000 customers and one million members served since launch, Omada is now a trusted infrastructure partner to organizations including Costco, Cigna Healthcare, Intermountain Health, and Express Scripts by Evernorth. Its commercial engine spans both direct employer relationships and scaled channel partnerships, giving customers the flexibility to implement Omada across diverse populations and benefit strategies.

At the heart of Omada’s differentiation is its Compassionate Intelligence—human care delivered with the precision of technology. In a healthcare system burdened by fragmentation and rising costs, Omada offers a unified, evidence-based, and member-loved alternative.

As chronic conditions continue to drive national healthcare spend and digital health adoption accelerates, Omada is positioned to lead the shift toward proactive, outcomes-based care—delivered not at the point of crisis, but at the point of need.

History

Omada Health began its journey in 2011 with a bold ambition: to prove that virtual care could rival—and even surpass—the clinical results of traditional, in-person health interventions. In 2012, Omada launched its first program focused on diabetes prevention and weight health, built on the principles of evidence-based care, digital scalability, and human-centered support.

From the outset, Omada’s approach challenged the status quo. While most of the healthcare industry remained rooted in episodic, in-person visits, Omada focused on the gaps between them—developing a Between-Visit Care model that combined clinical rigor with behavioral science and technology. The goal was simple but ambitious: help people manage chronic conditions in real time, with the tools and support they need, wherever they are.

Omada’s early success was quickly recognized. The CDC granted pending recognition to its diabetes prevention program in 2012, and by 2016, Omada earned full recognition—a milestone that validated the effectiveness of its digital-first care model. These early wins laid the foundation for a strategic expansion into other chronic conditions, based on feedback from customers, channel partners, and a growing member base.

By 2018, Omada launched new programs for diabetes and hypertension, and followed with MSK care in 2020—enabled through the acquisition of Physera. These moves transformed Omada from a single-condition solution into an integrated, multi-condition care platform. As the company evolved, so did its technology and clinical operations, culminating in the launch of the Omada Insights Lab—a cross-functional innovation hub designed to accelerate outcomes and efficiency through real-world data and applied research.

Omada continued to scale. By 2025, the company had served over one million members, supported more than 2,000 enterprise customers, and earned recognition from national organizations including the CDC, NCQA, URAC, and ADCES. Omada’s programs span prediabetes, type 1 and type 2 diabetes, hypertension, obesity, MSK conditions, GLP-1 Care Tracks, and behavioral health—delivered through an integrated platform that remains rooted in human relationships and enhanced by technology.

Throughout its history, Omada has stayed committed to rigorous measurement and transparency. With 29 peer-reviewed studies published by the end of 2024 and member engagement rates exceeding 30 interactions per month, the company continues to demonstrate that its model drives real, lasting change. In 2024 alone, over 55% of members in cardiometabolic programs were still actively engaged after 12 months—and over 50% remained engaged after 24 months.

From a single program to a multi-condition platform, Omada Health has grown with purpose. Its trajectory reflects the convergence of empathy, innovation, and scientific integrity—and it’s only just begun.

Risk factors

Omada Health operates at the intersection of clinical care, digital technology, and behavioral science—a promising but increasingly complex and competitive sector. As the company prepares to enter public markets, several operational, strategic, and external risks could materially impact its growth trajectory and long-term sustainability.

1. Limited Operating History
Founded in 2011, Omada has grown quickly from a single-program provider to a multi-condition platform. While this expansion reflects market demand, it introduces scale-related risks. Managing rapid growth across care delivery, operations, and technology infrastructure places significant strain on internal systems and talent. Failing to optimize this scale could compromise customer outcomes, operational quality, and overall financial performance.

2. History of Losses and Path to Profitability
Omada continues to operate at a net loss—reporting a $47.1M loss in 2024 and $9.4M in Q1 2025—despite consistent revenue growth. The company’s investments in product development, customer success, and infrastructure have outpaced revenues, resulting in a $453.4M accumulated deficit as of March 2025. Future profitability hinges on successfully balancing continued growth with improved cost discipline and margin optimization.

3. Uncertain Market Adoption and Program Acceptance
Omada’s success depends on broad adoption of its Between-Visit Care model by employers, health plans, PBMs, and members. Market acceptance could be hindered by skepticism toward virtual care, low member engagement, lack of compelling clinical evidence compared to competitors, or concerns around data privacy, AI, and cybersecurity. Any perception that Omada’s programs are more complex, costly, or less effective than alternatives could limit growth.

4. High Market Competition and Pricing Pressure
The digital chronic care space is increasingly crowded. Omada competes directly with companies like Virta Health, Hello Heart, Hinge Health, and Livongo (Teladoc), many of which offer similar solutions at competitive price points. Larger players and health systems may launch competing platforms or integrate vertically. This dynamic intensifies pricing pressure and forces continual innovation just to maintain differentiation.

5. Volatility in Customer and Channel Partner Growth
Revenue growth is closely tied to member enrollment through employer contracts, health plans, and channel partners. A slowdown in the growth or renewal of these relationships—or underperformance in clinical guarantees tied to weight loss, A1C, or MSK outcomes—could result in lower revenue or even repayment obligations. The non-exclusive nature of Omada’s channel relationships adds further risk, as partners may shift to competing vendors.

6. Operational Dependence on Member Engagement
Omada’s value proposition depends on high and sustained member engagement. While 55% of members remain active after one year, long-term retention varies by program and cohort. Declining engagement directly impacts Omada’s engagement-based pricing model, creating revenue volatility and undermining the perceived effectiveness of its programs.

7. Regulatory and Reimbursement Landscape Risk
As a virtual healthcare provider, Omada must comply with HIPAA, data privacy regulations, and evolving digital health policies. Any shift in reimbursement frameworks, benefit design, or federal support for personalized care models could materially affect demand. Increased scrutiny over AI usage in healthcare could also introduce new regulatory complexity.

8. Innovation Risk and Technological Disruption
To stay ahead, Omada must continually evolve its technology stack and product portfolio. Emerging therapies—such as advanced GLP-1s or AI-powered diagnostics—could reduce the need for behavioral programs, particularly if new treatments show superior outcomes at lower costs. The pace of innovation in healthcare tech is accelerating, and failure to keep up could render Omada’s model less relevant over time.

9. Macroeconomic Sensitivity and Workforce Pressure
Omada’s performance is indirectly affected by broader economic trends, including employment shifts, benefit budgets, and inflationary pressures. Additionally, recruiting and retaining qualified care team members—especially at scale—may become more difficult or costly, potentially impacting care quality and scalability.

10. Funding Needs as a Public Company
As Omada enters public markets, it faces increased costs associated with compliance, reporting, and investor relations. While its IPO may unlock capital for growth, continued expansion—especially into new markets like Medicare Advantage or government contracts—may require further funding. Failure to raise sufficient capital on favorable terms could delay key initiatives or constrain strategic flexibility.

Market Opportunity

Omada Health operates at the center of one of the most urgent, high-cost, and high-impact sectors in American healthcare: the management of chronic conditions. With more than 154 million individuals covered by commercial health insurance in the U.S.—and tens of millions of them living with prediabetes, diabetes, hypertension, or musculoskeletal (MSK) conditions—Omada is positioned to address a massive and growing demand for scalable, evidence-based care.

Chronic conditions account for the largest share of healthcare spend in the U.S., yet they are often managed inconsistently and reactively. Omada’s model—virtual, continuous, and deeply personalized—is designed to bend that curve. Built for people between doctor’s visits, our approach connects clinical guidance, human support, and behavioral science in a way that legacy systems and episodic models cannot.

$135 Billion Commercial Market Opportunity

As of year-end 2024, Omada estimates a total addressable market (TAM) of approximately $135 billion within the commercially insured population for its four core conditions:

  • Prediabetes: $41.4B

  • Diabetes: $17.3B

  • Hypertension: $31.6B

  • MSK conditions: $44.8B

These estimates are grounded in CDC prevalence data and Omada’s existing commercial pricing, and reflect the vast unmet need for proactive, accessible care across these conditions. Today, approximately 18 million commercially insured individuals have access to at least one Omada program—just a fraction of the total opportunity.

The Medicare Advantage Horizon

Looking ahead, Omada is exploring broader distribution into government-supported plans such as Medicare Advantage, where the need for chronic care management is even more pronounced. With 33 million beneficiaries as of 2024 and high prevalence rates of diabetes, hypertension, and MSK issues, this population represents an additional $32.3 billion market opportunity. As public payers shift toward value-based care, Omada’s engagement-based pricing and outcomes-driven model are well aligned to meet policy and clinical objectives.

GLP-1 Integration as a Strategic Multiplier

Omada’s clinical offerings are also enhanced by the growing use of GLP-1 therapies for weight management and metabolic disorders. While Omada does not develop or prescribe these medications, its behavior-change programs are increasingly recommended as lifestyle companions to GLP-1 regimens. According to internal analyses, members who were actively engaged in Omada’s platform while using GLP-1s lost 1.7x more weight than those who were less engaged. This synergy not only validates the importance of combining pharmacology with human support—it expands the addressable opportunity for Omada's GLP-1 Care Tracks.

A High-Need, High-Impact Market

As U.S. employers, health plans, and PBMs look to control rising chronic care costs while delivering a better member experience, the demand for integrated, tech-enabled care solutions is accelerating. The chronic care market is no longer a single-condition vertical—it’s a multi-condition ecosystem, requiring coordinated interventions and a unified experience.

Omada’s platform is purpose-built for this new era. Its human-led, data-driven model offers an alternative to fragmented point solutions and passive digital tools. With deep traction in commercial insurance, proven outcomes, and a flexible delivery model that scales across industries and geographies, Omada is positioned to lead the next chapter of chronic care.

Product

Chronic conditions are not a segment of the U.S. healthcare system—they are the system’s defining challenge. They account for the largest and most expensive population cohorts across every commercial insurance plan. This is the landscape Omada Health was built to serve.

Today, approximately 154 million Americans are covered by commercial health insurance, with tens of millions navigating the daily realities of prediabetes, diabetes, hypertension, or musculoskeletal (MSK) conditions. These conditions are often overlapping, persistent, and systemically underserved. Yet they are precisely where virtual-first, evidence-based care can make the greatest impact.

Omada’s virtual model is designed not for episodic care—but for sustained engagement. It is a platform built for behavior change at scale, guided by clinically validated interventions and aligned with payer outcomes. The result is a differentiated solution in a market that is both vast and underpenetrated.

A $135 Billion Commercial Opportunity

Omada’s core addressable market is defined by its focus on four chronic conditions across the commercially insured U.S. population:

  • Prediabetes: $41.4 billion

  • Diabetes: $17.3 billion

  • Hypertension: $31.6 billion

  • MSK Conditions: $44.8 billion

These figures are derived from CDC prevalence data, commercial coverage estimates, and current pricing—reflecting real-world reach, not theoretical scale. As of December 2024, only 18 million individuals have access to an Omada program, leaving the majority of this market untapped.

$32.3 Billion Medicare Advantage Opportunity

The next growth horizon lies beyond the traditional commercial segment. Medicare Advantage, with 33 million beneficiaries in 2024, presents a parallel opportunity to extend Omada’s impact. Chronic conditions are even more prevalent among aging populations, and payers are increasingly aligned with value-based models. This segment adds an additional $32.3 billion in potential revenue—driven by the same four high-impact conditions.

GLP-1s: A New Vector for Engagement

The rise of GLP-1 therapies for obesity and metabolic disorders adds a new dimension to Omada’s platform. While Omada does not develop or prescribe these medications, its programs are increasingly seen as critical lifestyle companions. According to internal analysis, members on GLP-1s who were highly engaged in Omada lost 1.7x more weight over 12 months than those with limited engagement.

This reinforces a powerful insight: pharmacology without behavior change is incomplete. Omada’s GLP-1 Care Tracks extend the value of medication with lasting lifestyle transformation, opening another strategic growth lane in a fast-expanding market.

Payers want cost containment. Patients want convenience. Employers want healthier workforces. Regulators want outcomes. Omada’s platform addresses all four stakeholders. In a fragmented healthcare system, it offers continuity, engagement, and evidence-based care at population scale.

Chronic care is not just a problem to be managed—it’s a transformation to be led. Omada is positioned to do just that.

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Business Model

Omada operates a scalable, dual-path business model that combines direct employer contracting with channel-partner distribution across health plans and pharmacy benefit managers (PBMs). This blended structure enables Omada to serve as both a contracted digital care provider and a distributed platform embedded within broader payer ecosystems—capturing value across the chronic care spectrum.

Direct-to-Employer model

In its direct-to-employer model, Omada contracts directly with thousands of U.S. businesses, ranging from small employers to Fortune 500 companies. These customers pay to offer Omada’s programs—covering diabetes, prediabetes, hypertension, and musculoskeletal (MSK) conditions—as core employee health benefits. This structure gives Omada ownership of customer relationships and control over implementation timelines, typically aligning with the annual benefits selling cycle from late spring to early fall.

In parallel, Omada’s channel-partner model enables it to scale through large health plans and PBMs. These partners either:

  • Act as Omada’s customers, covering the cost of care for defined member cohorts; or

  • Serve as distributors, reselling Omada programs to their own employer customers.

This approach broadens distribution, embeds Omada within existing health plan infrastructure, and ensures alignment with payer objectives such as cost containment and outcomes-based care.

Omada’s business model is anchored in long-term, recurring relationships. As of December 31, 2024:

  • The company retained over 90% of customers on a three-year average basis

  • Achieved net dollar retention of 110% in 2023 and 128% in 2024—indicating strong upsell and expansion dynamics across its existing base

Revenue grew 38% year-over-year in 2024 to $169.8 million, with quarterly growth accelerating to 57% year-over-year in Q1 2025. While Omada remains in investment mode—reporting net losses of $47.1 million in 2024 and $9.4 million in Q1 2025—losses have narrowed meaningfully as operating leverage improves.

Multiple Revenue Streams

Revenue is composed of two primary categories:

  • Services revenue, derived from clinical program delivery, ongoing coaching, and digital interventions across four chronic conditions

  • Hardware revenue, generated through the provision of connected third-party devices—including blood glucose monitors, smart scales, blood pressure cuffs, and CGMs—bundled with cardiometabolic programs at enrollment

Omada’s use of upfront payments and deferred revenue recognition creates a consistent, contractually bound revenue flow. This is supported by over 679,000 enrolled members as of March 31, 2025, across both direct and channel pathways.

Go-to-Market Engine

Omada’s go-to-market strategy follows a B2B2C motion, targeting benefits decision-makers at large employers and leveraging channel partnerships to access downstream customers. The company’s commercial engine is calibrated to the annual health benefits cycle—allowing synchronized implementation and scalable onboarding tied to open enrollment periods.

Beyond employers, Omada is actively embedded in fully insured health plans, PBM-led condition-specific programs, and value-based care arrangements with health systems that assume financial risk for patient populations.

Full-Service Delivery

Once enrolled, members are supported by a dedicated Omada Care Team—including licensed health coaches, physical therapists, and condition-specific specialists—delivered via a proprietary digital interface. This is augmented by connected devices, real-time data capture, and behaviorally informed engagement protocols.

Omada’s integrated delivery model—spanning clinical services, technology, and hardware—creates a defensible offering in a market where longitudinal care is essential but rarely executed with consistency.

By maintaining commercial flexibility across both direct and indirect contracting pathways, Omada is positioned to lead in chronic care—a space defined by long-duration engagement, complex comorbidities, and a premium on outcomes. With rising adoption of GLP-1s, growing interest in value-based care, and increasing payer alignment with digital-first solutions, Omada’s model offers a structurally advantaged platform in one of healthcare’s most urgent and expansive markets.

Management Team: 

Sean Duffy – Co-Founder & Chief Executive Officer


Sean Duffy has served as Chief Executive Officer of Omada Health since co-founding the company in April 2011. He brings a cross-disciplinary background in healthcare, design, and technology, having previously worked at IDEO in its health and wellness practice and at Google in its people analytics group. Sean holds a B.A. in Neuroscience from Columbia University and was enrolled in the joint M.D./M.B.A. program at Harvard University. His vision and operational leadership have guided Omada from an early-stage concept to a virtual-first care platform with national scale.

Steve Cook – Chief Financial Officer
Steve Cook has served as Chief Financial Officer of Omada Health since July 2021. He previously held senior finance leadership roles at 1Life Healthcare (One Medical), including Vice President and Head of Strategic Finance, helping steer the company through growth and eventual acquisition by Amazon. Prior to that, he spent seven years at Salesforce in finance and strategy roles. Steve earned his B.A. in Political Science from the University of California, San Diego.

Wei-Li Shao – President
Wei-Li Shao has served as President of Omada Health since December 2021, after previously serving as Chief Commercial Officer. He brings over two decades of healthcare and commercial leadership, including a long tenure at Eli Lilly & Company, where he held roles such as Vice President of Lilly China Diabetes and General Manager in several international markets. Wei-Li holds a B.S. in Biochemistry from the University of Wisconsin-Madison and an M.B.A. from the Kelley School of Business at Indiana University. He currently oversees Omada’s commercial, operations, and growth strategy execution.

Investment

Omada Health began its funding journey with a clear thesis: virtual care could not only match but exceed the outcomes of traditional, in-person chronic disease programs. That thesis has been validated by over a decade of sustained investor support. Since 2013, Omada has raised more than $528.5 million across 12 funding rounds, backed by a syndicate of premier venture and institutional investors—including Norwest Venture Partners, Andreessen Horowitz, Wellington Management, New Enterprise Associates, and Founder Collective.

Foundational Rounds (2013–2017)

Omada’s earliest institutional capital came through a $4.7 million Series A led by U.S. Venture Partners in 2013, enabling the launch of its first program in diabetes prevention. As demand grew, the company scaled operations through successive Series B and Series C rounds, raising $23 million (2014), $48 million (2015), and $50 million (2017). Backers included Andreessen Horowitz, Cigna, and Norwest Venture Partners—reflecting growing belief in the company’s tech-enabled care model.

Institutional Scale-Up (2019–2022)

By 2019, Omada had evolved into a multi-condition care platform, leading to a $73 million Series D led by Wellington Management. This was followed by a significant Series E raise of $192 million in 2022, led by Fidelity, cementing Omada as one of the best-capitalized digital health companies in the chronic care space. These rounds funded expansion into musculoskeletal care, GLP-1 support, and behavioral health—all delivered through Omada’s integrated virtual platform.

Flexible Financing & Market Endorsement (2023–2025)

In 2023, Omada secured an $80 million debt financing facility, underscoring the strength of its recurring revenue and predictable cash flows. The company’s most recent activity came in May 2025 via a secondary market transaction, indicating liquidity interest from long-term shareholders and continued validation from the capital markets.

Competition

Omada Health operates within the increasingly crowded and fast-evolving digital health sector—one that spans chronic disease management, virtual care delivery, and AI-enabled health coaching. While the category remains early in its maturity, competitive pressure is intensifying as new entrants emerge and established players double down on virtual-first care strategies.

Legacy Giants and Digital-First Challengers

The company faces direct competition across multiple condition categories. In cardiometabolic care, rivals include Hello Heart, Lark Health, Onduo, and Livongo (via Teladoc Health)—many of which offer condition-specific programs that overlap with Omada’s scope. In musculoskeletal (MSK) health, Hinge Health and SWORD Health dominate the field with focused, device-integrated solutions.

Omada also competes with platforms like DarioHealth, which combine cardiometabolic and MSK offerings into a single experience. These players benefit from focused R&D, brand equity in specific conditions, and strong payer or employer partnerships.

Dual-Front Competition

But the competitive dynamics extend beyond other virtual care startups. Health systems, payers, and employer groups are increasingly building their own digital platforms, creating in-house alternatives to third-party providers like Omada. Meanwhile, large tech companies—including Amazon, Apple, and Google—have steadily deepened their presence in healthcare, often via strategic partnerships or acquisitions that give them rapid access to users, data, and distribution.

This dual-front competition—facing both dedicated digital health firms and large ecosystem players—creates unique strategic tension for Omada, which must maintain product depth while delivering enterprise-grade flexibility across its customer base.

Fragmentation and Point Solutions

Omada must also contend with a long tail of point-solution startups, many offering AI-driven interventions or narrowly scoped digital therapies for single conditions. These startups often attract employer interest with lightweight deployments and competitive pricing, even if long-term engagement and outcomes are less validated.

Structural Advantages of Incumbents

Several of Omada’s competitors enjoy structural advantages: longer operating histories, larger sales teams, deeper brand recognition, and wider channel access. In some cases, competitors are backed or acquired by multinational insurers or pharmaceutical companies, giving them a capital and compliance edge. Consolidation trends may further magnify these advantages as ecosystem players seek scale through M&A.

Omada’s Differentiation

Despite these headwinds, Omada Health has built a defensible position through its multi-condition care model, proactive human-led care, and deep clinical validation, backed by 29 peer-reviewed publications. The company’s outcomes-based model and growing enterprise traction have helped it win trust from over 2,000 employers, health plans, and health systems.

Omada’s integrated platform spans diabetes, hypertension, behavioral health, and MSK—offering a unified experience for both members and employers. Its emphasis on sustained engagement, hybrid care teams, and flexible integrations with third-party devices and systems provides a differentiated value proposition in a fragmented market.

Financials

Omada’s topline saw substantial acceleration in Q1 2025, reflecting increased adoption of its services and a growing hardware footprint:

  • Q1 2024: $35.1 million

  • Q1 2025: $55.0 million

  • YoY Growth: +57%

Growth was primarily driven by a 47% YoY increase in total members, with higher average fees per member and increased hardware adoption:

  • Services revenue: +55% YoY ($17.6M increase)

  • Hardware revenue: +71% YoY ($2.3M increase)

This dual-engine revenue model—recurring services with embedded hardware—creates an annuity-like profile with upsell opportunities at scale.

Gross Profit & Margins

A standout metric this quarter was gross profit, which grew 84% YoY—nearly doubling on the back of operating leverage:

  • Q1 2024: $17.3 million (49.4% margin)

  • Q1 2025: $31.9 million (58.0% margin)

Operating Expenses

While revenue grew 57%, cost of revenue rose just 30%, evidencing improved scalability:

  • Cost of services: +24%

  • Cost of hardware: +38%

Operating expenses remained elevated but showed signs of stabilization:

  • R&D: Flat at ~$8.8M

  • Sales & Marketing: +17% YoY

  • G&A: +22% YoY

The business is still investing for growth, but the pace of spend is slowing relative to revenue, setting the stage for long-term operating leverage.

Net Loss Narrowing

The company cut its net loss nearly in half, moving from a $(19.0)M loss in Q1 2024 to $(9.4)M in Q1 2025:

  • This was driven by higher gross profit (+$14.6M)

  • Flat interest expense and muted non-cash charges helped preserve gains

Strategic Outlook

Momentum is strong across both member growth and financial performance. Key signals for investors:

  • Scalable model: High member growth without proportional opex increases

  • Margin leverage: Expanding gross margin despite hardware mix

  • Efficiency flywheel: Better tools → lower cost-to-serve → improved margins

Looking ahead, Omada is increasingly positioned to shift from growth-at-all-costs to profitable scale, with structural gains in member LTV and unit economics suggesting long-term durability.

Closing thoughts

Omada’s Q1 2025 results reflect a business shifting gears—from aggressive growth to disciplined scale. With revenue up 57%, gross margin expanding by 860bps, and net losses nearly halved, Omada is beginning to showcase operating maturity without losing momentum.

Bull Case:
Omada’s topline growth is both strong and efficient. A 47% increase in total members fueled gains across both services and hardware, while strategic investments in automation and internal tooling drove meaningful operating leverage. With improving unit economics and a dual-revenue engine, Omada is positioning itself as a high-margin, tech-enabled healthcare platform with scalable infrastructure.

Bear Case:
While net losses are narrowing, the path to profitability is still under construction. Sales and administrative spend remain high, and although share-based compensation is stable, growth deceleration or operational hiccups—particularly in member acquisition or hardware logistics—could compress margins. External factors like consumer behavior shifts or supply chain disruptions also pose risks.

In sum:
Omada is growing smart. Q1 2025 demonstrated its ability to scale revenue while compressing losses and expanding margins. With continued focus on execution, cost discipline, and member experience, Omada is building the foundation to become a long-term category leader—if it can sustain this balance between growth and operational rigor.

Here is my interview with Jason Schappert is the CEO of, Moola, an AI-powered stock scoring and decision engine designed to empower the next generation of investors to achieve true financial freedom. Earlier, MzeroA was named one of the Inc. 500’s top-growing private companies and recognised as a “Best Place to Work.”

In this conversation, Jason and I discuss:

  • How to accurately value a high-growth company?

  • Looking back at MzeroA’s growth, what was Jason’s best strategic decision

  • What unique insights about retail investors did Jason discover that led to creating Moola’s AI scoring system?

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